the use and abuse of referees and special masters in discovery

The Use and Abuse of Referees and Special Masters in Discovery

Wednesday, October 26th, 9:00 - 10:30 As courts have become more burdened and short of funds, they have increasingly turned to private judges, referees, or special masters to resolve discovery disputes. This panel will address the pluses and minuses of this trend, including the consequences of having a parallel system of justice for well-heeled parties, the consequences of having cutting-edge issues of, for example, e-discovery, resolved in private, the advantages and disadvantages of having discovery motions carefully considered and extensively litigated, how to work effectively with a referee, and so on.

Panelists: The Honorable William Bassler, Arbitrator/Member, the AAA National Roster of Neutrals American Arbitration Association Adam Brezine, Partner Holme Roberts & Owen LLP Meryl Macklin, Partner Holme Roberts & Owen LLP Jeffrey S. Ross, Managing Counsel Oracle Heather Shull, former Corporate Counsel Century Link

IN THE COURSE OF LITIGATION, it is almost inevitable that disputesarise about discovery. Whether they pertain to objections at deposi-tion or the timeliness and scope of written discovery responses, theyoften can be resolved through informal discussions or compromisesbetween counsel. At other times, counsel may need to involve the courtthrough discovery motions. In a few instances, however, particu-larly in those involving obstructionist counsel or a multitude of dis-covery issues, it may be prudent to consider the appointment of oneor more discovery referees. The presence of a referee during deposi-tions can often persuade even the most obstreperous counsel and wit-nesses to behave in a more reasonable manner.On the other hand, the costs associated withthe appointment of a discovery referee may farexceed the utility provided.

California statutory law provides for theappointment of a discovery referee by a writ-ten stipulation of the parties or, when the par-ties cannot agree, upon the court’s own motionor its ruling on a party’s noticed motion.1

When one party’s counsel demonstrates anintention to obstruct the discovery process atevery turn (whether by engaging in abusivebehavior at deposition or ignoring discoveryrequests) or when the case is complicated by anenormous amount of documents and issues, thecourt may decide that a discovery referee’s appointment is the mostefficient method by which to resolve such matters.2

While a referee may make matters more efficient from the court’sperspective, the parties in the litigation may be more concerned withthe expense. Counsel should remember that discovery referees are paidby the hour, and the fees are usually apportioned equally between theparties.3 If a referee is appointed early in discovery and is compelledto attend depositions, analyze objections, and consider numerous dis-covery requests and motions, his or her fees can pose a daunting obsta-cle to settlement—and, possibly, an attorney’s relationship with theclient. Counsel should therefore be familiar with the process bywhich referees are appointed and what steps may be taken to advo-cate or oppose an appointment.

The Appointment Process

The first step a trial court must take to appoint a discovery refereeis to make a written determination that “exceptional circumstances”require the appointment. The finding also must be specific to the cir-cumstances of the particular case.4 Case law provides guidance as towhat constitutes exceptional circumstances.5 Examples include the fol-lowing:

• Multiple issues must be resolved.

• Multiple motions must be heard simultaneously.

• A discovery motion before the court is only one in a sequence ofmany.

• The number of documents to be reviewed require an inordinateamount of time.

After the determination is made and the referee is appointed, thediscovery review process is established at the referee’s discretion.6 Thereferee may, for example, decide to consult with each of the parties’counsel, consider all the matters in dispute, and then set a timetablefor briefs and discovery motions. Sometimes, the referee may requestbriefs before meeting with counsel. Again, however, referees are paidby the hour, so they have personal as well as professional incentivesto be thorough before making discovery recommendations to the court.

Counsel may expect referees to schedule informal conferences andhearings to seek input.7

Referees generally do not make the actual decisions on discoverydisputes but rather they simply make recommendations to the court.8

The recommendation and approval process may allow for the par-ties, including those parties that are represented by obstructionist coun-sel, to get multiple opportunities to object and present their arguments.Specifically, the court may allow the parties to object within 10 daysof the service and filing of the referee’s recommendations and another10 days for responses to the objections.9 Alternatively, the courtmay set a schedule that is based on the parties’ stipulation or that isbased on its own convenience. Whatever the schedule, the delays stem-ming from objections to the referee’s recommendations may make lit-igation even more costly and may force the parties to spend more timein the courtroom than they would have if a referee had not beenappointed.

Counsel should also keep in mind that the referee’s report mayinclude recommendations not only on procedural and substantive dis-covery matters but also for sanctions against parties and counsel.10

Thus, maintaining a civil approach to discovery disputes, especiallybefore the referee, is paramount. Let those on the other side be thejerks.

10 Los Angeles Lawyer December 2004

Richard Lee is a litigation associate at Holland & Knight LLP in Los Angelesand a member of the Barristers Executive Committee.

Barristers Tips BY RICHARD LEE

Appointing a Discovery Referee in California State Court

A discovery referee, while sometimes useful when dealing with

numerous complicated discovery issues, can open a Pandora’s

box of consequences for all parties, not the least of which may be

the substantial expense.

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Furthermore, unless the court sets forth,in its written ruling appointing the referee, aceiling on the amount of hours that the ref-eree should bill, it is possible that the refereemay stay with the litigation until the case’sfinal disposition, whether that means settle-ment or the close of trial.

A Motion to Disqualify

With all these considerations regarding bal-looning costs, delays, and additional, time-consuming courtroom appearances, what cancounsel do to avoid the court’s appointmentof a referee? Either or both parties can moveto disqualify a discovery referee, much in theway that the parties can use peremptory chal-lenges to disqualify a trial judge.11 Such amotion to disqualify must be timely. When areferee is to be appointed only for a limitednumber of discovery disputes, the motionmust be made at least 5 days before the hear-ing or trial date, so long as the referee assignedto hear the disputes is known for at least 10days prior to the hearing or trial date.12 Andwhen a discovery referee is appointed for alldiscovery purposes, generally, the motionmust be made within 10 days of the notice ofthe appointment of the referee.13

A discovery referee, while sometimes use-ful when dealing with numerous complicateddiscovery issues, can open a Pandora’s box ofconsequences for all parties, not the least ofwhich may be substantial expense. Cautionis the word of the day when consideringagreeing to a discovery referee or when thecourt imposes one. In a perfect world, disputescan be resolved with phone calls and letters,but litigation can be an imperfect, contentiousbattleground that unfortunately may lead toincivility and stubbornness. Resorting to a dis-covery referee is an extreme measure, and sothe threat of moving for a referee’s appoint-ment may actually be an effective negotiatingtool in resolving disagreements with obnox-ious opposing counsel. Nevertheless, in somehigh-stakes cases in which a referee’s feeswill constitute only a fraction of the totaldiscovery costs, the appointment of a refereemay save the parties trouble. ■

1 CODE CIV. PROC. §§638, 639(a)(5); CAL. R. CT.244.1, 244.2.2 See CODE CIV. PROC. §639(a)(5); see also Hood v.Superior Court, 72 Cal. App. 4th 446, 449 (1999).3 CODE CIV. PROC. §645.1.4 CODE CIV. PROC. §639(d)(2).5 Taggares v. Superior Court, 62 Cal. App. 4th 94, 105(1998).6 See CAL. R. CT. 244.2(h)(2).7 See generally CAL R. CT. 244.2(h).8 CODE CIV. PROC. §§639(a)(5), 643.9 CODE CIV. PROC. §643(c).10 See Sauer v. Superior Court, 195 Cal. App. 3d 213,225 (1987).11 CODE CIV. PROC. §§170.6, 639(b).12 CODE CIV. PROC. §639(b)(B).13 CODE CIV. PROC. §639(b)(A).

12 Los Angeles Lawyer December 2004

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State Court Authorities Governing Special Masters, Referees, Commissioners, and Similar

Judicial Adjuncts

And

Comparison State Rules to Federal Rule of Civil Procedure Rule 53

State Authorities and Comparison to FED. R. CIV. P. Rule 53

Alabama ALA. R. CIV. P. WITH DIST. CT. MODIFICATIONS 53 Adopts pre-2003 amended version of the federal rule but state rule does not apply to state district courts.

Alaska ALASKA R. CIV. P. 53 ALASKA CT. R., CHILD IN NEED OF AID 4 ALASKA CT. R., DELINQUENCY 4

Arizona 16 PART 1, A.R.S. RULES OF CIV. PROC., RULE 53 ARIZ. R. SUPER. CT. 96(e) (granting presiding judge in Superior Court power to appoint Court Commissioners with agreement of each party) Adopts pre-2003 amended version of the federal rule.

Arkansas ARK. R. CIV. P. 53 Modeled after pre-2003 amended version of the federal rule but limited to non-jury actions.

California CAL. CIV. PROC. CODE §§ 638 - 639 (West 2004) Requires agreement of the parties.

Colorado COLO. CT. C.P.R. 53 Adopts pre-2003 amended version of federal rule.

Connecticut CONN. R. SUPER. CT. PROC. FAMILY MATTERS § 25-53 Limited scope – only applies to family law matters. Pilot program established for civil/family discovery masters and civil matter settlement conferences scheduled to end 12/31/2004.

2004] STATE COURT JUDICIAL MASTERS 1300

Delaware DEL. S. CT. R. 43(b)(v) DEL. CT. CH. R. 135 – 47 DEL. FAM. CT. C.P.R. 53 DEL. SUPER. CT. CRIM. R. 5 Limited to hearing issues of fact.

District of Columbia D.C. SUPER. CT. R. CIV. P. 53 D.C. SUPER. CT. R. DOM. REL. 53 D.C. SUPER. CT. R. CRIM. P. 117 Adopts pre-2003 amended version of the federal rule.

Florida FLA. STAT. ANN. R.C.P. RULE 1.490 (West 2004 & Supp. 2005) Requires parties’ consent.

Georgia GA. CODE ANN. §§ 9-7-1 to -6 (1982 & Supp. 2004)

Hawaii HAW. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Idaho IDAHO R. CIV. P. 53 IDAHO CRIM. R. 2.2 Adopts pre-2003 amended version of federal rule.

Illinois Illinois does not use fee officials.1

Indiana IND. R. TRIAL P. 53 Adopts pre-2003 amended version of federal rule.

Iowa IOWA R. CIV. P. 1.935 Adopts pre-2003 amended version of federal rule.

Kansas KAN. STAT. ANN. § 60-253 (1994 & Supp. 2002) When parties consent, any issue can be referred to a special master. Contains language where without the parties consent, the court can only refer a case to a master when justice will be measurably advanced, or to cases that will be tried to a jury when they involve examination of complex or voluminous accounts.

Kentucky KY. R. CIV. P. 53.01

1. Mullaney, Wells & Co. v. Savage, 282 N.E.2d 536, 538 (Ill. App. Ct. 1972).


When appointed to matters other than judicial sales, settlement, receivership, and bills of discovery assets of judgment debtors, appointment requires that the matter involve complex calculations, multiplicity of claims, or other exceptional circumstances.

Louisiana LA. REV. STAT. ANN. § 13:4165 (West Supp. 2004) Court can appoint in any civil action with parties consent if there is a complicated issue or when exceptional circumstances exist.

Maine ME. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Maryland MD. CIR. CT. R. CIV. P. 2-541 Limited to non-jury matters.

Massachusetts MASS. R. CIV. P. 53 MASS. R. CRIM. P. 47 Adopts pre-2003 amended version of federal rule but also requires assent of all parties prior to special master appointment.

Michigan MICH. CT. RULES PRAC. R. 3.913 Applies to probate and juvenile court. Can conduct preliminary inquiries and can preside at hearings other than a jury trial or preliminary examination.

Minnesota MINN. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Mississippi MISS. R. CIV. P. 53 Can refer any issue to a special master with the written consent of the parties, otherwise appointment requires an exceptional condition.

Missouri MO. R. CIV. P. 68.01 Adopts pre-2003 amended version of federal rule.

Montana MONT. CODE ANN. § 25-20-R. 53 (2003) Adopts pre-2003 amended version of


federal rule. Nebraska NEB. REV. STAT. §§ 25-1129 to -1137

(2004) Appointment requires written consent of the parties.

Nevada NEV. R. CIV. P. 53 NEV. 1ST JUD. DIST. CT. R. 5 Adopts pre-2003 amended version of federal rule.

New Hampshire N.H. R. SUPER. CT. 85-A Appointment requires written consent of the parties.

New Jersey N.J. CONST. art. 11, § 4, ¶ 7 N.J. R. CIV. PRAC. 4:41 Appointment requires parties’ consent.

New Mexico N.M. R. CIV. P. 1-053 Adopts pre-2003 amended version of federal rule.

New York N.Y. UNIF. TRIAL CT. R. § 202.14 Chief Administrator of courts has power of appointment.

North Carolina N.C. GEN. STAT. § 1A-1, R. 53 (2003) Modeled after pre-2003 amended version of federal rule. Certain actions require parties’ consent prior to appointment.

North Dakota N.D. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Ohio OHIO REV. CODE ANN. CIV. R. 53 OHIO REV. CODE ANN. CRIM. R. 19 OHIO REV. CODE ANN. JUV. R. 40 Modeled after pre-2003 amended version of federal rule. Does include pre-trial and post-trial matters, or matters where the parties consent.

Oklahoma OKLA. STAT. ANN. tit. 12, §§ 612-619 (West 2000) Can appoint to any civil action with the parties’ written consent.

Oregon OR. R. CIV. P. 65 Appointment requires written consent of


the parties; without consent of the parties, appointment requires an exceptional condition.

Pennsylvania 42 PA. CONS. STAT. ANN. §§ 1558, 1920.51 (West 2002) Court can appoint at any time after the preliminary conference and master can hear any issue or the entire matter.

Rhode Island R.I. R. CIV. P. 53 R.I. R. PROC. DOM. REL. 53 Adopts pre-2003 amended version of federal rule but also provides greater latitude in appointing a special master; special master may be appointed to any issue where the parties agree.

South Carolina S.C. R. CIV. P. 53 Allows appointment when the parties consent.

South Dakota S.D. CODIFIED LAWS § 15-6-53 (West 2004) Adopts pre-2003 amended version of federal rule.

Tennessee TENN. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Texas TEX. R. CIV. P. 171 Adopts pre-2003 amended version of federal rule but requires parties’ consent to appointment of a master. Other modifications include that the case must be an “exceptional one” and there must be “good cause” for appointment of a master.

Utah UTAH R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Vermont VT. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule with minor modifications. State rule is narrower because for actions to be tried by a jury, appointment is only made when the action requires investigation of accounts or examination of


vouchers. Virginia VA. S. CT. R. 2:18, 3A:1

A court decree refers a matter to a “commissioner in chancery.”

Washington WASH. SUPER. CT. CIV. R. 53.3 Adopts rule that is broader than the pre-2003 amended version of federal rule. State rule allows appointment for “good cause” and allows appointment of special master to discovery matters.

West Virginia W. VA. R. CIV. P. 53 Wisconsin WIS. STAT. § 805.06 (1994)

Adopts pre-2003 amended version of federal rule with minor modifications, i.e. “referee” used in place of “special master.”

Wyoming WYO. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

22 Georgia Bar Journal

Although discovery under the Georgia Civil

Practice Act1 is supposed to be a coopera-

tive, largely self-executing process, as a

general proposition, it is often anything but that, and

the courts’ supervision is frequently compelled by the

inability of the parties to agree about much of any-

thing. All too often the courts become drawn into dis-

covery battles that are every bit as incomprehensible to

the courts as they are wasteful of the time and

resources of all involved.

In our experience, complex commercial cases areparticularly prone to discovery disputes. Such casesfrequently require the exchange of an enormous vol-ume of data by the parties under the supervision of thecourts. Complex commercial cases nearly alwaysinvolve more data, more documents, more witnesses,and, because of the amounts in controversy, morelawyers. This, of course, means more issues and moredisputes, which yield more motions and more work forthe already overburdened courts. The only thing there

is less of is judicial time and resources with which toaddress the litigation landslide. The discovery processcan grind to a halt, while the parties wait for the courtto clear the way of the obstacles the parties have creat-ed. Sound familiar?

The purpose of this article is to propose a solution:the use of special masters to ride herd over unrulyarmies of lawyers in complex civil cases and to handletime-consuming issues in other cases.2 Of course, noteveryone will agree that special masters are theanswer, but we believe that they can go a long waytoward addressing problems that arise when complexcases overwhelm the courts with equally complex andburdensome discovery disputes. As one noted com-mentator put it: “Special masters can help redress theimbalance that demoralizes a court that is confrontedby the squads of lawyers and masses of data thatinvariably accompany major cases.”3 Under the CivilPractice Act, special masters may be appointed by thecourt upon the request of the parties or when “the factsand circumstances of any such case require it.”4

We submit that once a complex case reaches motionpractice in the course of discovery, the appointment ofa special master to resolve discovery disputes is appro-priate because it would: (1) allow judges to concentrateon pressing matters that can be addressed more quick-ly in other cases without getting bogged down in theminutiae of complex-case discovery; (2) save time andmoney for the litigants in the long run; and (3) promoteefficient and fair resolution of the case itself.

Special Masters:Mastering the PretrialDiscovery Process

by Cary Ichter and S. Paul Smith

GBJ Feature

The Legal Foundationfor Special Masters for Discovery

The use of special masters has along tradition dating back to theEnglish courts in chancery andcontinuing in equity cases in theUnited States. As Justice Brandeisexplained in Ex parte Peterson,courts have “inherent power toprovide themselves with appropri-ate instruments required for theperformance of their duties. Thispower includes authority toappoint persons unconnected withthe court to aid judges in the per-formance of specific judicial duties,as they may arise in the progres-sion of a cause.”5

In Georgia, special masters aregoverned by O.C.G.A. § 9-7-1 to § 9-7-6. O.C.G.A. § 9-7-2 providesthat “[u]pon application of eitherparty, after notice to the oppositeparty, the judge of the superiorcourt, in equitable proceedings ifthe case shall require it, may referany part of the facts to an auditorto investigate and report theresult to the court. Furthermore, thejudge may, upon his own motion,when in his judgment the facts andcircumstances of any such caserequire it, refer the same to an audi-tor.”6 In short, the decision ofwhether to refer a matter to a spe-cial master is one that is com-mended to the sound discretion ofthe trial court and will not be dis-turbed absent an abuse of discre-tion.7

The type of master that is con-templated by the statute appears tobe primarily in the role of a fact-finder, evidentiary analyst or dis-covery referee.8 Indeed, the use ofspecial masters for discovery incomplex cases in the federal systemis common and has been extensive-ly discussed, particularly withrespect to the recently revised Rule53 of the Federal Rules of CivilProcedure.9 Judge Scheindlin, amember of the AdvisoryCommittee on the Federal Rules ofCivil Procedure that amended Rule53, explained further:

With respect to “discovery” mas-ters, district courts increasinglyviewed resort to a Rule 53 masteras necessary in light of increasingdocket pressures and limited judi-cial resources. Masters have beenappointed to oversee the discov-ery process, which can entailresolving disputes, establishingprocedures and schedules, moni-toring document production, andattending depositions and confer-ences. References of discoveryand discovery disputes have beenseen as particularly usefulbecause of their time-consumingnature or need for immediate res-olution. Factors considered inthese appointments included thevolume of material to be pro-duced and exchanged, the scien-tific and technical nature of theinformation subject to discovery,and the complexity of the under-lying dispute.10

While virtually all, if not all,referral orders appointing special

masters appear to be made pur-suant to section 9-7-2, a persuasiveargument can be made, and hasbeen made in other jurisdictions,that the courts have the inherentpower to appoint special masters.Indeed, courts have long been heldto have the inherent power to pre-scribe the manner in which thebusiness of the court is to be con-ducted.11

In addition, the courts have cer-tain authority conferred upon themby statute that could empowerthem to appoint special masters.For example, O.C.G.A. § 15-1-3(4)empowers “every court” to “con-trol, in the furtherance of justice,the conduct of its officers and allother persons connected with ajudicial proceeding before it, inevery matter appertaining thereto.”Moreover, it has long been recog-nized that the courts’ power tomake a referral is not limited tosuits for an accounting.12 In passingupon the constitutionality of the

April 2007 23

Magistrate’s Act in the criminalcontext, the Supreme Court ofGeorgia declared, “The judges ofsuperior court have been givenauthority to appoint other inferiorjudicial officials, i.e., judges pro hacvice, special masters, ex-officio jus-tices of the peace; and U.S. DistrictCourt judges have statutory author-ity to appoint federal magistrates.We have not found any cases, norhave we been cited to any, holdingthese delegations of authority to beunconstitutional.”13

The Mechanics of a Referral Order

The mechanics of such anappointment or referral are fairlysimple. If the parties consent to theappointment or if the court findsthat the matter would benefit fromappointment of a master, the courtmay make a referral. The court needonly enter an order making theappointment, describing the scopeof the master’s appointment and

powers, describing the manner inwhich the master is to report to thecourt, and directing as to how themaster is to be compensated. A formorder that includes the standard ele-ments of a referral order is providedat the conclusion of the article.

Because a special master is notan Article III judge or a judgeappointed under Article VI of theGeorgia constitution, a special mas-ter may not issue dispositive rul-ings. The special master may, how-ever, issue rulings upon non-dis-positive matters, such as discoverydisputes, and may conduct hear-ings on dispositive matters andissue a report and recommendationto the court.

The appointing court maintainsthe ability, and the obligation, tooversee the decisions of the specialmaster, reviewing, when calledupon by motion of a party, thedecisions of the master. As onecourt has explained it, “In essence,then, the trial judge who appointeda special master in a non-jury civil

case has transformed his role intothat of an appellate court, at leastwith regard to the resolution of fac-tual issues.”14

The Need for Special Masters

Nationally, between 1993 and2002, state court caseloads haveincreased at a steady pace. Overthose 10 years, state court civil casefilings increased 12 percent, crimi-nal case filings 19 percent, domes-tic relations case filings 14 percentand juvenile case filings 16 per-cent.15 Overall, state court civilcase filings increased 12 percentfrom 1993 to 2002, and 96.2 millionnew cases were filed in state courtsin 2002.16 Those trends have con-tinued unabated.

Appointments of new judgeshave not kept pace with growingcaseloads. While all categories ofnew case filings have averagedmore than 1 percent growth peryear, the growth in the pool of


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judges to handle those matters hasrisen by less than 0.5 percent peryear.17 In other words, the rate ofcase filings is outstripping thegrowth of judicial resources by afactor of better than two to one.Meanwhile, budgets for courts, atall levels all across the country, arebeing cut.

Of particular concern is thatincreasingly complex, technicaland resource-consuming mattersare being introduced at the statecourt level. The difficulties aremultiplied because state courtsoften lack the support found at thefederal level, where judges enjoythe assistance of one or more clerksand larger support staffs. Withlarger dockets involving morecomplicated matters and more“managerial judging” to be done,state courts are often strained tothe breaking point.

Within this deluge of disputesare more and more complex com-mercial matters—matters that caninvolve highly technical factual,legal and discovery issues and tensof thousands to millions of pages ofdocuments. The documents inthese cases are often a mixture oftechnical, confidential, proprietaryand privileged materials that aremaintained in a host of differentenvironments, including electronicversions that exist on desktops, inhard drives, servers, archives andlegacy back-up systems that maynot be currently supported by anyexisting vendor. In short, it hardlyrequires the creative minds of high-powered legal talent to uncovergenuine discovery issues thatrequire significant technical compe-tence.

Tens of thousands of pages ofdocuments usually translate, mini-mally, into scores of witnesses,and, given the ability to workremotely that technology affordsus, taking testimony from thosewitnesses is often a multi-jurisdic-tional operation. And then thereare the experts, who construct tech-nical complexities atop proceduralcomplexities. In the final analysis, asingle complex matter could

become a full time job for a court,and few, if any, state courts havethe ability to dedicate all their timeand attention to a single matter.

A study conducted by theFederal Judicial Center found greatsatisfaction in all quarters, judgesand litigants, with the performanceand contributions of special mastersin cases to which masters wereappointed, concluding that specialmasters were “extremely to veryeffective.”18 The study reported,“The work of special masters is veryhelpful; in fact one judge inresponding to the FJC Study‘wished he had appointed a discov-ery master earlier.’ The FJC Studyshows that generally, judgesappointing special masters thoughtthat the ‘benefits of appointmentsoutweighed any drawbacks.”19 Thestudy concluded that special mas-ters delivered “better, faster, andfairer resolution of litigation in thecases in which masters are used, aswell as ... easing the burdens thesecases place on the judiciary.”20

Answering ObjectionsOf course, not everyone agrees

that special masters should be moreregularly appointed. One argumentthat has been leveled againstenlarging the use of special mastersis that in doing so the courts abdi-cate their responsibility and theirpower. The same argument wasemployed to protest the use of arbi-tration, and that argument lost infavor of maximizing the functionalefficiency of the process. Congress,through the Federal ArbitrationAct, and the states decided that pri-vate adjudication of matters is notproblematic because arbitration canbe more cost-efficient and reducedthe burden on the court system, inaddition to promoting the freedomof parties to define their own rela-tionships by contract. This is not tosay that the arbitration system isperfect, or that everyone is satisfiedwith it, but the policy considera-tions that have prompted the moreprevalent use of arbitration applywith equal weight to the use of spe-cial masters.

The use of special masters pro-motes the same ends as arbitration,but the special master is backed upby the trial court that makes thereferral. Unlike the decisions ofarbitrators, every decision of a spe-cial master is subject to review bythe referring court. Hence, withspecial masters there is no abdica-tion of power and no loss ofauthority in the judicial branch.The special master is a tool of thecourt; the special master in no wayreplaces the court.

Others object that the costs of aspecial master should not be thrustupon litigants simply because theyare involved in complex litigation.We believe, to the contrary, that theintroduction of a special master toa complex matter can actuallyreduce the costs of the matter. First,because of the undistracted atten-tion a special master can lavishupon a complex matter, he or shecan fashion matter-specific andissue-specific structure and disci-pline on the discovery process atan earlier stage than might other-

April 2007 25

wise be possible. “This sharpenedfocus will beget more timely andresponsive production of request-ed discovery materials, willdecrease the burden upon and thecost to the producing party andwill shorten the pretrial discoverystage with commensurately fore-shortened litigation.”21

On the other hand, it is our expe-rience that, when confronted withcomplex, resource-consuming mat-ters, courts can tend to apply rigidand formulaic structures to thematters in the hope that fixedschedules and procedures willmove the matter along without theintervention or attention of thecourt. Bitter experience has proventhat such formulas simply do notwork. “[T]oo much pressureapplied in the wrong circum-stances can wreck an entire pretrialprocess … . A special master devot-ing a substantial attention to onecase may be more successful atfinding the proper balance than a… judge with responsibility formany cases.”22

Additionally, the introduction ofa special master “into the discoveryprocess may induce the parties tobe more cooperative because theyare compelled with an unbiasedindividual focused on the discov-ery process, rather than with abeleaguered judge to take note ofthe dilatory maneuvering.”23 Asone commentator has noted, “Thereality is that efficiencies broughtabout by special masters ultimatelysave money for the parties andsave public resources.”24

Finally, if the special master alsointroduces the deterrent effect ofshifting the costs of unsuccessfuldiscovery maneuvering to the non-prevailing party, the master mightall but eliminate costly, time-con-suming and meaningless discoverymotions practice. In short, specialmasters, properly used, could rep-resent an enormous cost savingsfor litigants in complex cases.

ConclusionCourts have the inherent power

to control their dockets, and one

tool they can use to accomplish thatend is the appointment of a specialmaster in proper cases. While thispower has been usually reservedfor instances involving complexmatters of accounting, there is noimpediment to a court employingO.C.G.A. § 9-7-1 et seq. to efficientlymove nightmarishly complex casesalong. We believe there is good rea-son to do so: it would ease the bur-den on the courts, promote efficien-cy within the case itself; and in theend save money for the litigants.

Not everyone will agree thatmore frequent use of special mas-ters is a good idea. But many of thearguments against the use of spe-cial masters were previously usedagainst arbitration, and, ultimately,the use of arbitration has grown. Ifwe, as lawyers, are serious in ourcomplaints about discovery abuse,waste, and delay by the courts, wehave an obligation to do somethingabout it or stop complaining alto-gether. Using special masters fordiscovery matters in complex casesis one way we can help.

Cary Ichter is a part-

ner in the Atlanta

office of Thompson

Hine LLP where he is a

member of the firm’s

business litigation

practice group. A trial lawyer who

primarily handles commercial dis-

putes, his clients include national

franchise companies, which he

represents both regionally and

nationally. Ichter earned a B.S.

from West Georgia College in

1981 and his J.D., magna cum

laude, from the University of

Georgia in 1984.

S. Paul Smith is of

counsel in the Atlanta

Office of Thompson

Hine LLP. He practices

primarily in the busi-

ness litigation practice

group, where he focuses on gen-

eral commercial litigation, com-

plex technology/intellectual prop-

erty disputes, and business

“divorces.” Smith earned a B.A.

from Mississippi College in 1990

and graduated from Columbia

Law School in 1993, where he was

a Senior Editor on the Columbia

Law Review.

Endnotes

1. O.C.G.A. § 9-11-1 et seq. (2006).

2. It is beyond the scope of this arti-

cle to fully explore the many uses

court can make of special masters,

but here are a few that can be

found in the cases and the litera-

ture: overseeing and monitoring

discovery; conducting large in cam-

era document reviews; supervising

class notice process; conducting

Daubert and similar statutory

expert witness evaluations; manag-

ing electronic data discovery; pre-

siding over evidentiary hearings;

overseeing the winding up of the

affairs of corporations and partner-

ships; calculating attorneys’ fees

and other damages; preserving

marital estates and issuing reports

and recommendations in domestic

relations matters; disputes con-

cerning the management and legal

compliance of public institutions

such as schools, jails and utilities

systems; and making value deter-

minations for damages purposes in

complex damages cases.

3. WAYNE D. BRAZIL ET AL., MANAGING

COMPLEX LITIGATION: A PRACTICAL

GUIDE TO THE USE OF SPECIAL

MASTERS, 5 (1983).

4. O.C.G.A. § 9-7-2.

5. Ex parte Peterson, 253 U.S. 300,

364-65 (1920); see also Irving R.

Kaufman, Masters in the Federal

Courts: Rule 53, 58 COLUM. L. REV.

452, 462 (1983) (“[T]here has

always existed in the federal courts

an inherent authority to appoint

masters.”).

6. O.C.G.A. § 9-7-2 (emphasis

added).

7. See Mobley v. Faulk, 42 Ga. App.

314, 156 S.E. 40 (1930). Given the

importance in this state of a trial

by jury, it is not surprising that in

those instances where it was error

to appoint a special master, or not


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error to not appoint a special mas-

ter, the jury’s role was a primary

consideration. See, e.g., Franklin v.

Franklin, 267 Ga. 82, 475 S.E.2d

890, 891 (1996) (reversing because

“[a]lthough a trial court has the

authority to refer an equitable

proceeding to an auditor, it is

apparent that no purpose is

served in appointing an auditor

in a domestic case where pur-

suant to a proper demand, all

issues relating to alimony and

property division must ultimately

be submitted to the jury”);

Steenhuis v. Todd’s Constr. Co.,

227 Ga. 836, 183 S.E.2d 354, 355

(finding no abuse of discretion in

not appointing an auditor where

“it cannot be said that a jury is

not better qualified to pass upon

the same than an auditor”). For

this reason, the U.S. Supreme

Court’s decision in La Buy v.

Howes Leather Co., 352 U.S. 249,

256 (1957), severely restricted the

power of federal courts to employ

Rule 53, except in exceptional

cases, because to do so would

“displace the court.”

8. See Mark A. Fellows & Roger S.

Haydock, Federal Court Special

Masters: A Vital Resource in the Era

of Complex Litigation, 31 WM.

MITCHELL L. REV. 1269, 1276 (2005)

(“Even in the era of the restrictive

La Buy exceptional condition stan-

dard for special master appoint-

ments, reference of the manage-

ment and supervision of discovery

in complex cases was relatively

uncontroversial. The appointment

of a special master whose authori-

ty was limited to managing discov-

ery was perceived by the courts to

be less of an abdication of the judi-

cial function because it did not

deprive the parties of the right to a

trial before the court on the basic

issues of the litigation.”).

9. See, e.g., Fellows & Haydock, supra

note 8; Shira A. Scheindlin &

Jonathan Redgrave, Revisions in

Federal Rule 53 Provide New Options

for Using Special Masters in

Litigation, 76 N.Y. ST. BAR J. 18

(2004).

10. Scheindlin & Redgrave, supra note

9, at 21.

11. “That the courts possess certain

inherent powers, is a proposition

which, so far as we know, has

never been questioned. This

means, then when the constitution

declares that the legislative, judi-

cial, and executive powers shall

forever remain separate and dis-

tinct (art. 1, sec. 1, par. 23), it here-

by invests those officials charged

with the duty of administering jus-

tice according to law with all nec-

essary authority to efficiently and

completely discharge those duties

the performance for which is by

the constitution committed to the

judiciary, and to maintain the dig-

nity and independence of the

courts.” Lovett v. Sandersville R..

Co., 199 Ga. 238, 33 S.E.2d 905

(1945) (citations omitted).

12. See, e.g., Candler v. Bryan, 189 Ga.

851, 8 S.E.2d. 81, 85 (1940). The

Candler case citied with approval

the decision in Lamar v. Allen, 108

Ga. 158, 33 S.E. 958 (1899), in which

the Supreme Court had noted, “As

a matter of fact, there was but one

question to be determined, that is,

who was the brother of Richard

Lamar,” and yet held, “An exami-

nation of this record satisfies us

that this was a case in which refer-

ence to an auditor was peculiarly

appropriate. No jury could have

dealt with the mass of conflicting

testimony in as satisfactory a way

as the same was dealt with by the

intelligent and able auditor to

whom the case was referred.”

Candler, 8 S.E.2d at 85-86.

13. State v. Andrews, 240 Ga. 541, 242

S.E.2d 153, 156 (1978).

15. Collins v. Foreman, 729 F.2d 108,

119 (2d Cir. 1984). Consequently, it

makes good sense for parties to

ensure that a record of proceed-

ings before a special master is

maintained so that the parties have

a record to present to the trial

court should it become necessary

to do so.

15. NATIONAL CENTER FOR STATE

COURTS, EXAMINING THE WORK OF

STATE COURTS, COURT STATISTICS

PROJECT (2003).

16. Id.

17. FRANCES KAHN ZEMANS, COURT

FUNDING, ABA STANDING

COMMITTEE ON JUDICIAL

INDEPENDENCE 1, 11 (Aug. 2003).

18. WILLGING ET AL., SPECIAL MASTERS’

INCIDENCE AND ACTIVITY: REPORT TO

THE JUDICIAL CONFERENCE’S

ADVISORY COMMITTEE ON CIVIL

RULES AND ITS SUBCOMMITTEE ON

SPECIAL MASTERS (2000).

19. Id.; see also Lynn Jokela & David F.

Herr, Special Masters in State Court

Complex Litigation: An Available and

Underused Case Management Tool,

31 WM. MITCHELL L. REV. 1299,

1313 (2005).

20. WILLGING ET AL., supra note 18.

21. Richard H. Agins, An Argument for

Expanding the Application of Rule

53(b) to Facilitate Reference of the

Special Master in Electronic Data

Discovery, 23 PACE L. REV. 689, 720

(Spring 2003).

22. Id. (quoting ROBERT D. MCLEAN,

PRETRIAL MANAGEMENT IN COMPLEX

LITIGATION: THE USE OF SPECIAL

MASTERS IN UNITED STATES V.

AT&T, at 278 (1983)).

23. Agins, supra note 21, at 720.

24. WILLGING ET AL., supra note 18, at 59.


SaveValuable

ResearchTime

SAMPLE ORDERIN THE ____________ COURT OF __________ COUNTY

STATE OF GEORGIA_____________________________,

Plaintiff,v. CIVIL ACTION

FILE NO. _________________________________________,

Defendant.

ORDER APPOINTING SPECIAL MASTERThis action is before the court on [the Court’s own motion] [the application of the parties] to appoint

_______________ as a Special Master in the above-styled case, subject to the terms and conditions set forth herein.Duties

The Special Master is hereby directed to proceed with all reasonable diligence to perform the following functions:A. Case Management: The Special Master shall have the authority to conduct scheduling conferences, establish case

management orders and discovery schedules, and otherwise perform such acts necessary to expeditiously and effi-ciently move the case through the discovery process, including issues related to electronic data discovery and priv-ilege.

B. Conflict Resolution: The Special Master shall have the power to entertain all motions for relief brought by the par-ties concerning discovery, with or without a hearing, and shall issue written rulings thereon with all reasonablediligence upon submission to the Special Master. Included within the power to conduct hearings on motions shallbe the power to receive testimony under oath before a court reporter, and to preside over the reception of evidenceinto the record.

C. Settlement: The Special Master may serve as a mediator, if requested by the parties, to facilitate settlement of thecase.

D. Sanctions: The Special Master may award costs of motions and impose sanctions upon any party for failure to com-ply with discovery requirements.

E. Other Duties: The Special Master may perform such other and further tasks not specifically enumerated above ifsuch additional undertaken in furtherance of the above scope of appointment. The Special Master may performadditional tasks and functions (including, but not limited to, ruling on motions for non-discovery related injunc-tive relief) if the parties consent thereto, or if the Court, upon application of one of the parties, specifically appointsthe Special Master to so act.

Conduct of PartiesThe parties are instructed to cooperate with the Special Master in all respects, including, but not limited to, making available

to the Special Master any facilities, files, databases, documents, or other materials the Special Master may request to fulfill theSpecial Master’s duties hereunder. The parties are not permitted to engage in ex parte communication with the Special Masteror the Special Master’s administrative staff, except as would be permitted with the Court and the Court’s staff, or except as suchcommunications may relate to settlement of the case where the Special Master has been asked to serve as a mediator.

Compensation of the Special MasterThe Court has considered the fairness of imposing the likely cost of the Special Master on the parties and has taken steps

to protect against unreasonable expense and delay. In light of the determined need for the appointment of the Special Master,the Court concludes that the parties shall bear the cost of the Special Master on the following terms and conditions: TheSpecial Master shall charge an hourly rate of $___.00 and shall keep an account of all hours or quarter-hour fractions there-of, and any expenses incurred by the Special Master in the performance of the Special Master’s duties hereunder. The SpecialMaster will issue an invoice describing the work performed and the hours attributable to the work performed, plus theexpenses incurred by item, to the parties on a monthly basis. The parties shall each pay their pro rata [i.e., if two parties, 50%each; if four parties, 25% each, etc.] share of the invoice promptly and in no event less than 30 days from the issuance there-of. Any dispute by any party over any aspect of the invoice shall first be raised informally with the Special Master for possi-ble resolution, and if resolution is not agreed, then the party disputing any aspect of the invoice may address such disputeto the Court by motion, to which the Special Master may respond.

MiscellaneousThe Special Master is instructed to maintain all pleadings and correspondence submitted by the parties in connection with

the case and to forward the entirety of such documents and records to the Court at the conclusion of discovery. The partiesneed not file with the Court a duplicate of the documents submitted to the Special Master.

The Special Master, by accepting this appointment, represents to the Court that there are no matters within the scope ofthis appointment for which the Special Master could or should be disqualified, and that the Special Master accepts the termsand conditions of this appointment set forth herein.

This Order shall be effective upon the submission by the Special Master of the affidavit required immediately above.

SO ORDERED, this ______________ of ___________, 200__._______________________Judge, _____________ Court of _______________ County

SPECIAL MASTERS/Marsee 0

Howard R. Marsee Upchurch Watson White & Max 1060 Maitland Center Commons Suite 440 Maitland, Florida 32751 407-661-1123

UTILIZING “SPECIAL MASTERS” IN FLORIDA: UNANSWERED QUESTIONS, PRACTICAL CONSIDERATIONS AND THE ORDER OF

APPOINTMENT

Howard R. Marsee Author’s note August 25, 2009 -- This article was initially published in the October 2007 issue of The Florida Bar Journal. This is a revised version of that article. It has been updated to reflect amendments, since the article was first written, to Rule 53 of The Federal Rules of Civil Procedure.

Copyright 2007 & 2009

“Masters” are adjuncts of the court, exercising limited judicial authority and appointed by the

court to perform specific tasks. “Special masters” typically are appointed by the presiding judge to

serve in specific cases.1 “General masters” serve more broadly and typically are appointed to serve

over a variety or class of cases, often on a venue-wide basis.2 The terms “special master” and

“general master” are sometimes confused or used indiscriminately, even within the same case.3

The master’s authority derives from his or her appointment by the court. Historically, courts

relied upon the common law and upon the court’s inherent authority to appoint masters and to define

the master’s duties and responsibilities.

4 The practice of utilizing masters to assist trial judges in the

disposition of cases predates the American legal system and has its origin in common law English

chancery courts during the reign of King Henry VIII.5 Congestion in the federal court system

spawned the use of masters in the United States as early as the colonial period.6


Over time, the use and appointment of masters came to be governed by state and federal rules

of civil procedure. At the state court level in Florida, the appointment of special masters in civil cases

is now governed by: Rule 1.490 of Florida Rules of Civil Procedure (hereinafter Rule 1.490); Rule

12.492 of the Florida Family Law Rules of Procedure (hereinafter Rule 12.492): and Rule 5.697 of

the Florida Probate Rules (hereinafter Rule 5.697).7 At the federal level, appointment is governed by

Rule 53 of the Federal Rules of Civil Procedure (hereinafter Rule 53). The role of masters has

evolved, from a strict and limited role of trial assistance, to a more expanded view – with the duties

and responsibilities of masters now extended to every phase of litigation.8

Masters perform a wide variety of tasks. They serve various roles in pretrial

discovery and proceedings, facilitate the mediated settlement of cases, make

recommendations and submit reports to judges, assist with complex issues, chair advisory

committees composed of lawyers of record, help administer class actions and settlements,

propose orders jointly recommended by the parties, make decisions based on judicial

reference or the parties’ consent, and become engaged in post-trial proceeding.

As court dockets have

burgeoned, and as litigation has become increasingly complex, the utilization of masters has

increased.

9

The purpose of this article is to identify some of the yet unanswered questions surrounding the

use of special masters in Florida, and to provide practical information for lawyers involved with the

appointment of a “special magistrate” or “special master.” Because the special master’s authority and

duties derive from the order appointing him or her, special consideration has been given to the form

of that order.

A note on nomenclature is unavoidable. “Magistrates” have replaced “masters” in Florida

state courts. Effective October 1, 2004, the Supreme Court of Florida amended Rule 1.490, Rule

12.492 and Rule 5.697 so that all references to “master” thereafter became “magistrate.” 10 “Special


masters” became “special magistrates.” The change was essentially administrative and cosmetic.11

Rule 53 continues to use the term “master” but has abandoned the term, ”special master.” A

careful reading of Rule 53, however, suggests that Rule 53 uses “master” synonymously with the

historic term “special master.” “Master” within the context of Rule 53 is a court-appointee

Both “master” and “magistrate” denote court appointees with varying degrees of limited judicial

authority. The subject of general magistrates, except incidentally, is outside the scope of this

article. We are concerned here with masters serving specifically delineated tasks in specific cases –

masters that have been historically designated as “special masters.”

in specific cases before the district court. Rule 53 makes no distinction between “general masters”

and “masters” because federal courts have institutionalized the role of magistrate judge.12

For purposes of simplicity and unless context clearly indicates the need for a distinction, this

article will use the terms “master”, “special master” and “special magistrate” interchangeably.

Consent to Appointment: The issue of consent under Rule 1.490(c) and Rule 12.492(b) is

straight forward. No reference may be made to a special magistrate without the consent of the

parties.13 Several Florida appellate decisions have held lack of consent fatal to the appointment of a

special master.14 Mandamus is appropriate to correct a trial court’s referral without consent.15 In

Prater v. Lehmbeck, where a party filed a blanket objection to referral to a master, but nevertheless

participated in the referred proceedings, the trial court assumed consent from the party’s participation

and was reversed on appeal.16

An interesting consent issue is whether a party, having given consent ab initio to the

appointment of a special magistrate, may later withdraw that consent. This may occur in matters

involving continuous magistrate supervision, such as supervision of discovery matters, when one

party decides that the magistrate’s rulings aren’t as favorable as desired. Rules 1.490, Rule 12.492

To minimize issues regarding consent, the order appointing the special

magistrate should recite that the referral is consensual.


and Rule 5.697 are silent on this question and there seems to be no Florida appellate law on point.

Logic would seem to require, at a minimum, that the party withdrawing consent should move for a

court order relieving the magistrate of his or her duties and responsibilities and – until that order is

rendered -- that the party is bound by the order appointing the special magistrate.

Probate Rule 5.697 is a relatively new rule, having been adopted in 1992 and “patterned after”

Rule 1.490.17 On its face, there is no requirement for consent by the parties to the appointment of a

special magistrate, and as yet there are no appellate decisions addressing this point. The drafters of

Rule 5.697 apparently chose not to adopt the consent language contained in subsection (c) of Rule

1.490. It would seem to follow that a consent requirement was not intended. One reason for this may

lie in the relatively narrow scope of duties performed by the special magistrate in probate. Subsection

(b) provides that special masters may be appointed “in connection with the court’s review of

guardianship accountings and plans.” This delegation of duties is more restrictive than the

delegation of duties contained in Rule 1.490.18

Under Federal Rule 53, consent is not in all instances necessary. Subsection (a)(1) provides

that non-consensual referrals, in cases to be decided by the court without a jury, may be justified by:

exceptional conditions; the need to perform an accounting or difficult damage computation; or the

need to address pretrial or post-trial matters that cannot be addressed effectively and timely by an

available district judge or magistrate judge

19 Rule 53(a)(3) requires the court to “consider the

fairness of imposing the likely expenses on the parties and must protect against unreasonable expense

or delay”. Notwithstanding Article III of the U.S. Constitution, non-consensual referrals to special

masters have been sustained against constitutional attack where the master’s duties were performed

under the “total control and jurisdiction of the district court….”20 The Supreme Court has recognized

that in certain situations, the efficiency and expertise benefits of such referrals outweigh the


diminution of Article III values (neutral, independent adjudication) – creating a kind of balancing

test.21

The master’s qualifications: Rule 1.490(b), Rule 12.492(a) and Rule 5.697(b) provide that

the court may appoint “members of The Florida Bar as special magistrates.” The subsections go on,

however, to provide that “upon showing that the appointment is advisable, a person other than a

member of the Bar may be appointed.” Rule 5.697 requires “good cause shown” for the appointment

of some person other than a member of The Florida Bar. Where the task to be performed requires

certain types of expertise, (e.g., accounting, corporate share valuation, patent issues, scientific

questions), the need for a non-lawyer may be the raison d’être for appointment of the master.

Rule 53(a)(2) contains no bar membership requirement. It provides that, without the consent

of the parties, “a master must not have a relationship to the parties that would require disqualification

of a judge under 28 U.S.C. § 455. The court may enter an order of appointment only after the master

has filed an affidavit disclosing whether there is any ground for disqualification under 28 U.S.C. §

455. The Academy of Court-Appointed Masters, a national organization, offers the following

suggested affidavit language.

I have thoroughly familiarized myself with the issues in this case. As a result of my

knowledge of the case, I can attest and affirm that I know of no grounds for disqualification

under 28 U.S.C. § 455 that would prevent me from serving as the special master in the

captioned matter.22

Rule 1.490, Rule 12.492, Rule 5.697 and Rule 5.697 require no affidavit regarding disqualification,

but they do provide in subsection (d), subsection (c) and subsection (c), respectively, that all

“grounds for disqualification of a judge shall apply to a magistrate.” Therefore, although not

required, it may be good practice in Florida state court actions to have the master file a modified

affidavit similar to that recommended by the Academy of Court-Appointed Masters.


In the order of referral to the master, the subject of the master’s qualifications should be

addressed. If the appointment is pursuant to Rule 1.490 or Rule 12.492, and the appointment is to a

person other than a member of the Florida Bar, then the order should recite the reasons that referral to

a non-Bar member is “advisable.” If the referral is pursuant to Rule 5.697, then the basis for a

finding of “good cause” ought to be recited. In all cases under Rule 53, and in state court cases

where an affidavit regarding disqualification has been filed, the order of appointment probably should

recite that the affidavit has been filed.

Oath and Bond requirements: Rule 1.490a) of the Florida Rules of Civil Procedure requires

persons appointed as general magistrates to “take the oath required of officers by the constitution and

the order shall be recorded before the magistrate discharges any duties of that office.” 23 In the case

of special magistrates, Rule 1.490(b), Rule 12.492(a) and Rule 5.697(b) specifically provide the

administration of an oath is discretionary with the court. This distinction between general and special

masters has its roots in chancery.24

Subsections (b) and (e) of Rule 1.490, and subsections (a) and (d) of Rule 12.492 address the

question of whether a bond may be required of the special magistrate. The gist of the subsections is

that the requirement of a bond is discretionary with the court. However, Rule 1.490(e) and Rule

12.492(d) specifically provide that the court may require bond of magistrates who are appointed to

dispose of real or personal property, and those subsections establish language that such bonds should

contain. Rule 5.697 does not address the subject of a bond. Rule 53 also is silent on the subject of a

bond. If a bond is going to be required in a case, whether state or federal, then any bond

requirements should be included in the order of reference to the master. The order should also

address all issues regarding funding of the bond.

Rule 53 doesn’t address the subject of an oath.

The master’s powers and duties: In broad terms, the master’s authority is established by the

terms contained in the order of reference. Therefore, it is extremely important to delineate in the


court’s order the task or tasks the master is to perform. The following is a representative sampling of

tasks assigned to masters in state and/or federal cases: ruling upon and monitoring discovery matters;

conducting in camera document inspections; coordinating discovery in multi-party or multi-district

cases; supervising class action notices; monitoring settlement and judgment compliance;

administering the distribution of settlement or judgment proceeds; making findings of fact and

recommendations regarding real property disputes; disposing of real or personal property under

jurisdiction of the court; overseeing the winding down of corporations and other business entities;

calculating damages and/or attorney’s fees; making insurance coverage determinations; serving as

technology masters; and managing settlement efforts in complex cases.

Rule 1.490, Rule 12.492 and Rule 53 offer some specific guidelines regarding the exercise of

the master’s powers, duties and authority. For example, Rule 1.490(d) and Rule 12.492(c) provide

that “the magistrate shall hold hearings in the county where the action is pending, but hearings may

be held elsewhere by order of court to meet the convenience of the parties or

witnesses.” Interestingly, Rule 1.490(d) and Rule 5.697(c) provide that “process issued by a magistrate shall be directed as provided as provided by law.” Rule 12.492 contains no such provision, and one is left to wonder whether the omission suggests that the special master under 12.492 may not issue process. If hearings are going take place outside the county where the action is

pending, then this should be included in the reference order. If any unusual problems with process

are anticipated, then these too ought to be addressed in the order.

Rule 1.490(f), Rule 12.492(e) and Rule 5.697(d) deal with the subject of hearings before the

magistrate. Generally, they place on the magistrate the duty to set and notice hearings, and provide

the authority to proceed ex parte if any party fails to appear. The magistrate may examine parties and

witnesses on oath and may require the production of books, papers, writings, vouchers, and other

documents. Under Rule 1.490 and Rule 12.492, the special magistrate may admit evidence by


deposition or otherwise and “may take all actions concerning evidence that can be taken by the court

and in the same manner.” The language of Rule 5.697 differs slightly. It makes no reference to

deposition testimony, but says essentially that the special magistrate shall admit evidence that “would

be admissible in court.” Under Rule 1.490(f) and Rule 5.697(d), evidence at hearings is to be taken

“in writing’ and shall “be filed with the magistrate’s report. Rule 12.490(e) differs slightly and

provides that, “unless otherwise ordered by the court, all parties shall equally share the cost of a court

reporter at a special magistrate’s proceeding.” Rule 12.492(e) also specifically provides that if all

parties waive the presence of a court reporter at hearing, they should do so in writing. In almost

every instance, therefore, it seems that a court reporter is advisable, and that the order of reference

should provide who is to make arrangements for the reporter and how the costs are going to be

allocated.

Rule 1.490(g) and Rule 12.492(f) deal with the content of the magistrate’s report:

In the reports made by the magistrate no part of any statement of facts, accounts, charge,

deposition, examination, or answer shall be recited. The matters shall be identified to inform the

court what items were used.

The precise language of Rule 5.697 differs, but the substance is the same. As will be discussed

hereinafter, the creation of a record is one of the master’s most important duties. Failure to provide

an adequate record can have serious consequences.

Omitted from Rule 1.490, Rule 5.697 and Rule 12.492 is whether the magistrate has the

authority to impose sanctions on any party for non-compliance with any of the magistrate’s

directives. Rule 53 explicitly addresses this question. Under Rule 53(c) the master has the authority

to impose any non-contempt sanction provided by Rules 37 or 45,25 but is limited to recommending

contempt sanctions. Absent an explicit delegation of contempt authority either by statute or by Rule

1.490, Rule 12.492 or Rule 5.697, it is doubtful whether a special magistrate under these Rules may


do more than recommend a contempt sanction to the presiding judge.26

Rule 53, Rule 1.490, Rule 12.492 and Rule 5.697 have very similar provisions regarding the

dispatch with the master is to proceed. Rule 1.490(f), Rule 12.492(e) and Rule 5.697(d) provide that

the magistrate “shall proceed with reasonable diligence” in every reference and with “the least

practicable delay.” They go further to say that any party may apply to the court for an order to the

magistrate to speed the proceedings. Rule 53(b)(2) requires that the order of reference “direct the

master to proceed with all reasonable diligence.”

It is also unclear whether a

magistrate under Rule 1.490, Rule 5.697 or Rule 12.492 may impose non-contempt sanctions (e.g.,

award attorney’s fees or costs, strike pleadings or defenses, or order matters taken as admitted) or

whether he or she is confined to recommending such sanctions to the presiding judge.

Rule 53(d) makes specific reference to “Master’s Orders.” Indeed, Subsections (d) and (e)

envision a court adjunct that both reports to the court and issues orders to the parties. At no place in

Rule 1.490, Rule 12.492 or Rule 5.697 is there reference to the master issuing or filing orders. One

can fairly ask whether a magistrate under the state rules has authority, whether explicit or implicit, to

issue orders – as opposed to recommending orders to the appointing judge. At least one appellate

decision has held that a special master’s role is advisory only, and that any ultimate disposition and

determination must be adjudicated by the court.27

On their face Rule 1.490, Rule 12.492 and Rule 5.697 seem to envision a narrower grant of

power to masters than those granted by Rule 53. One reason is historic. Rule 1.490, Rule 12.492 and

Rule 5.697 are based mainly on the old Chancery Act, sections 54 through 65, which were taken in

large part from the Federal Equity Rules.

28 The former practice in equity was to have testimony

taken by a master or special examiner.29 Masters in chancery were not adjuncts with adjudicative

functions. In England, chancellors would primarily utilize masters as assistants to aid in the

performance of ministerial functions such as: recording testimony, disposing of property in pursuance


of settling judgments, presiding over evidentiary hearings, tabulating damages, and auditing

accounts.30 In essence, masters in equity were information gatherers and advisers. Read in this

historic context, it is easy to see why Rule 1.490, Rule 12.492 and Rule 5.697 make no reference to

the issuance of orders by masters. It seems that Rule 53 has been “revised extensively to reflect

changing practices in using special masters”31

When appointing a special magistrate under Rule 1.490, Rule 12.492 or Rule 5.697 it seems

advisable to specifically include in the order of reference: whether the special magistrate may issue

orders; under what circumstances he or she may do so; and what types of orders are permissible.

Rule 53 (b)(A) provides that the order appointing a master must state the master’s duties and any

limits on his or her authority. Subsection (c) of Rule 53 (which enumerates fairly broad categories of

power vested in a master) opens with the language “Unless the appointing order directs otherwise….”

This underscores the relatively broad nature of authority granted the master under Rule 53. This

means also, however, that care must be taken in drafting the order of reference. An order of reference

that too narrowly delineates the grants of power could be construed as a limitation upon the broader

authority granted by Rule 53. The order of reference needs to be clear whether the intention is to

expand or curtail the authority granted by the language of the applicable rule.

-- whereas Rule 1.490, Rule 12.492 and Rule 5.697 are

still tethered to earlier equity practice.

The record, report and exceptions: Rule 1.490, Rule 12.492, Rule 5.697 and Rule 53 differ

significantly on the subject of the master’s report to the court. Rule 1.490(h) requires the special

magistrate to take evidence “in writing” and file that written record with the magistrate’s report.

Rule 12.492 requires a court reporter at hearing unless waived by all parties. Rule 5.697(d) provides

that “evidence shall be taken in writing or by electronic recording” and that the record “shall be filed

with the magistrate’s report.” All three rules prohibit the recitation of evidentiary detail in the body of

the report. Rule 53 does not specify how the record is to be created or what recitations may be


contained in the magistrate’s report, but it does provide in subsection (e) that the master must report

“as required by the order of appointment.” Under all three rules the report itself must be filed with

the court.

After the magistrate’s or master’s report has been filed with the court, any party may file

exceptions or objections to any or all of his or her findings and/or recommendations. Under Rule

1.490(h), Rule 12.492 and Rule 5.697(f), a party’s exceptions must be served within 10 days of the

master’s service of copies of the report on the parties. Rule 12.492(g), unlike Rule 1.490(h), provides

for the filing of cross-exceptions within 5 days of service of the opposing party’s exceptions. Under

Rule 53(f)(2) a party ”may file objections to – or a motion to adopt or modify – the master’s order,

report, or recommendations no later than 20 days from the time the master’s order, report, or

recommendations are served, unless the court sets a different time.” (Emphasis supplied). (Effective

December 1, 2009, Rule 53 (f)(2) is amended and the 20 day time period becomes 21 days.)

Cautious practitioners will note the distinction between “file” and “serve” in these rules.

If no exceptions or objections are filed, then the court, after expiration of the time for filing

exceptions or objections, may act on the report. Rule 1.490(h), Rule 12.492(g) and Rule 5.697(f)

each provide that the court “shall take appropriate action on the report.” It has been held reversible

error for the court to act on the magistrate’s report before the expiration of the time for exceptions.32

Even in the absent of exceptions by a party, the “trial court -- prior to entry of a final judgment in

accordance with the master’s report” -- has a duty to examine and consider the evidence for itself

and to determine whether under the law and facts the findings and recommendations of the magistrate

are justified.33 One Florida District Court of Appeal, addressing this issue under Rule 1.490,

expresses this view that review of the magistrate’s record is obligatory.34 There seems to be no

appellate decision addressing a potential problem created by Rule 12.492(e), which subsection


suggests that all parties may waive the presence of a court reporter at a magistrate’s hearing.

Without a record to review, how is the court to rule on exceptions to the magistrate’s report?

From the language of Rule 53(f)(1), a hearing is required but it lies within the discretion of

the federal court whether to review the record or evidence underlying the master’s report. Rule

53(f)(1) provides:

(2) Opportunity for a Hearing: Action in General. In acting on a master’s order, report, or

recommendations, the court must give the parties notice and an opportunity to be heard; may receive

evidence; and may: adopt or affirm; modify; wholly or partly reject or reverse; or resubmit to the

master for instructions. (Emphasis supplied]

Under Rule 1.490, Rule 12.492 or Rule 53, the court must provide an opportunity to be heard

once exceptions or objections are filed. Rule 5.697(f) provides that all “timely exceptions may be

heard by the court on reasonable notice by any party.”

Subsections (f)(3), (4), and (5) of Rule 53 provide explicit standards for the court’s review of

the master’s report. The court must decide de novo all objections to findings of fact made or

recommended by the master unless the parties stipulate, with the court’s approval, that the master’s

findings of fact will be reviewed for “clear error” or that findings of fact by a master appointed under

Rule 53 (a)(1)(A) or (C) will be final. If such stipulations exist, the order of reference should

acknowledge them and recite the court’s consent. The court must decide de novo all conclusions of

law made or recommended by the master. “Unless the order of appointment establishes a different

standard of review,” the court may set aside a master’s ruling on a procedural matter only for an

abuse of discretion. It is interesting to note that the appointing judge, arguably, may establish his or

her own standard of review for matters of procedure. If some standard other than abuse of discretion

is to be utilized, this is a subject that ought to be addressed in the order of reference.


Rule 1.490, Rule 12.492 and Rule 5.697 provide no explicit standards for a judge reviewing

the report and recommendations of a special magistrate. Instead, we need look to published appellate

decisions in Florida. The early decisions, arising during a time when special masters served

essentially as fact finders, couched the standard of review in jury-verdict terms. In essence, these

decisions hold that because the special master had the opportunity to observe the witnesses and assess

their veracity, the master’s findings and conclusions were to be accorded the same weight as a jury

verdict in a common law action.35 In examining the various appellate decisions addressing the

question of review standards, we see that over time two disparate sets of standards emerge. One line

of cases has adopted a “competent substantial evidence” standard for findings of fact and a “clearly

erroneous” standard for issues of law.36 A second line of decisions applies a “clearly erroneous”

standard for findings of fact and a “misconception of the law” standard for conclusions of law.37 The

two lines of cases are irreconcilable as to nomenclature, i.e., with respect to what they call the

standards of review. One Fifth District Court of Appeal decision interjects yet another variation on

the theme. In Anderson v. Anderson, the Fifth District Court of Appeal speaks of “a ’clearly

erroneous’ standard for findings of fact and an ‘abuse of discretion’ standard for the application of

law to the facts.” 38

There appears to be no Florida appellate decision considering what the standard of review

should be for procedural conclusions by the magistrate under Rule 1.490, Rule 12.492 or Rule 5.697.

For example, if the magistrate concludes that a party’s responses to requests for admission are

insufficient and that the matter requested be deemed admitted, what standard should the presiding

judge apply? Under the federal rule, the standard of review would be “abuse of discretion.” One can

only speculate whether a state appellate court would apply an “abuse of discretion” standard, a

“clearly erroneous” standard, or a “misconception of the law” standard.


An equally thorny problem is that of the special master’s record. As we have seen above,

Rule 1,490 requires that evidence be taken in writing and filed with the magistrate’s report. The court

has a sua sponte duty to examine and consider the evidence and to determine whether under the law

and facts the findings and recommendations of the magistrate are justified.39 If the magistrate fails to

make and file a written record, then the court is thwarted in this responsibility. Some earlier appellate

decisions held that it was the responsibility of the party filing exceptions to insure that the record was

made and filed, and failing to do so, that their exceptions should be overruled.40 Later decisions have

placed the onus of creating an accurate and complete written record on the master. In the Boalt v

Boalt and De Clements v De Clements cases,41

The requirement of Rule 1.490 to create and file a record with the magistrate’s report creates

some problems of expense and practicality. The parties may find it cost effective to have a court

reporter recording hearings, but want to withhold the ordering of a transcript until the filing of

exceptions. Further, some clerks of court may balk at voluminous filings of papers without an

imminent hearing that necessitates the filing. A common sense solution would be to address this

problem in the order of reference or by a stipulation of the parties. In any event, however, the special

magistrate, the court and the parties would be wise to create a complete an accurate record for each

proceeding presided over by the special magistrate – even if that record is subject to delayed

transcription and filing.

trial courts denied exceptions to special master reports

because the records of the masters’ proceeding were defective or unavailable. The trial courts in each

case placed the burden of providing the record, at the time of hearing on the exceptions, on the

excepting party. In each case the appellate court reversed. These decisions notwithstanding, Rule

12.492(g) provides that the “party seeking to have exceptions heard shall be responsible for the

preparation of the transcript of proceedings before the magistrate.”


Rule 53 contains no explicit provision requiring a written record or filing of such record with

the master’s report. However, subsection (b)(C) requires that the order of reference specify the

nature of the materials to be preserved and filed as the record of the master’s activities. Because a

written record is essential if the court is to perform a de novo review, the need for a record is central

in the procedural scheme of the Rule.

Form of the master’s report: The format of the master’s or magistrate’s report may be as

varied as the many tasks that can be assigned to him or her. However, due to the need for court

review and rulings on exceptions, the report should clearly distinguish between findings of fact,

rulings of a procedural nature, recommendations, and conclusions of law. This aids the parties and

the presiding judge in assessing: whether the master is deciding a matter within the scope of his or

her appointment; what records need to be reviewed for the purpose of ruling on exceptions, and what

standard of review is applicable to a given decision or conclusion. The report should reflect clearly

whether the master or magistrate is acting in an adjudicatory role (e.g., ruling on procedural matters,

matters of sanctions, etc) or in a fact finding or advisory role.

Ex parte communications: Rule 53 (b)(B) requires that the order of reference specify the

circumstances, if any, under which the master may communicate ex parte with the court or a party.

Rule 1.490, Rule 12.492 and Rule 5.697 are silent on the subject of ex parte communications. In

most instances, ex parte communications are probably not desirable or necessary. An exception may

be in situations where the master is serving as a settlement master.42 Whether dealing with a federal

or state appointment, the subject of ex parte communications ought to be addressed in the order of

reference. To the extent that a special master is granted adjudicative (as opposed to advisory)

powers, it probably would be wise to limit the conditions under which the master engages in ex parte

communications with the parties.43


Master’s compensation: Rule 53(b)(E) requires that the order of appointment specify the

basis, terms, and procedure for fixing the master’s compensation under Rule 53(g). Under that

subsection, compensation may be paid either by a party, parties or a fund or subject matter that is

within the court’s control. It also permits the court to specify how the compensation is to be allocated

among the parties. Rule 1.490 and Rule 5.697 make no reference to the magistrate’s compensation.

Rule 12.492(h) provides that “the costs of a special magistrate may be assessed as any other suit

money in family proceedings and all or part of it may be ordered prepaid by the order of the court.”

The order of reference should provide in some detail how compensation is going to be addressed.

One appellate decision outlines criteria the court should consider in adjudicating the compensation to

be paid the magistrate where the amount of compensation is in controversy.44

A final note: Today, electronic discovery looms large in litigation.

45 The U.S. Supreme

Court on April 12, 2006, approved extensive electronic discovery amendments to several of the

Federal Rules of Civil Procedure. 46 These took effect on December 1, 2006. The Florida Bar is

exploring whether to propose modifications similar to the Federal amendments.47

1 The provisions of Fed. R. Civ. P. 53, taken in their entirety, point to a case-specific designation of the person serving as

“master.”

The labyrinthine,

technical aspects of electronic discovery, and the increasing complexity of litigation generally, create

fertile ground for the utilization of special masters. Additional expansion of the role of masters seems

inevitable. Carefully drafted orders of reference, which anticipate issues and problems, can do much

to make the utilization of special masters effective and cost-efficient.

2 See generally: Bell v. Bell, 307 So.2d 911, at note 3 (Fla. 3rd D.C.A. 1975); Fla. Fam. Law R. P. 12.490; Fla. R. Juv.P.

8.060; and Fla. R. Traf. Ct. 6.630.

3 Compare Gray v. State of Florida, 489 So.2d 86 (Fla. 5th D.C.A. 1986) (The appellate court’s language suggests

confusion as to the status of the “master” involved in the case) with Ciccarelli v Ciccarelli, 352 So.2d 1204 (Fla. 4th

D.C.A. 1977) (The appellate court uses both terms in one sentence to describe a master, who from the context of the case,


appears to be the same person.) and Bell v Bell, supra (Fla. 3rd D.C.A. 1975) (The trial court in its judgment uses the term

“special master” to refer to a separate and distinct “general master” in the case.)

4 See Ex Parte Peterson, 253 U.S. 300, 312-13 (1920): Kimberly v. Arms, 129 U.S. 512, 524-525 (1889).

5 See Irving R. Kaufman, Masters in the Federal Courts : Rule 53, 58 Col. L. Rev. 452, 452 (1958).

6 See Bryant, The Office of Masters in Chancery: Colonial Development, 40 A.B.A. Journal, 595 (1954).

7 It should be noted that Rule 1.490 of the Florida Rules of Civil Procedure governs the appointment of both general and

special magistrates in civil cases. However Florida Family Law Rules of Procedure 12.492 governs only the appointment

of special magistrates. Rule 12.490 governs the appointment of general masters in family law cases. The appointment of

general masters in family law, and the use of masters under the Florida Rules of Juvenile Procedure, are beyond the scope

of this article.

8 For a detailed history of this evolution, see Mark A. Fellows and Roger S. Haydock, Federal Court Special Masters: A

Vital Resource in the Era of Complex Litigation, 31:3 William Mitchell Law Review (2005); and Shira A. Scheindlin and

Jonathan M. Redgrave, Master Rule 53: The Evolution and Impact of the New Federal Rule Governing Special Masters,

New York State Bar Journal (January 2004).

9 Mark A. Fellows and Roger S. Haydock, supra at 1270.

10 Amendments to the Florida Rules of Appellate Procedure, the Florida Rules of Civil Procedure, the Florida Rules of

Criminal Procedure, the Florida Family Law Rules of Procedure, the Florida Rules of Juvenile Procedure, and the

Florida Probate Rules, 887 So.2d 1090 (Fla. 2004).

11 The change in nomenclature was prompted by the need to reconcile the language of Rule 1.490 with 2004 legislative

changes to various related statutes. See id at 1090.

12 See Fed. R. Civ. P. 53(h). (dealing with the applicability of Rule 53 to magistrate judges.)

13 Consent is also required for referral to a general master under Fla. Fam. Law R. P. 12 490.

14 See Rosenberg v. Morales, 804 So.2d 622 (Fla. 3rd D.C.A. 2002); Pesut v. Miller, 773 So.2d 1185 (Fla. 2d D.C.A.

2000); and Wilson v. McKay, 568 So. 2d 102 (Fla. 3rd D.C.A. 1990).

15 Novartis Phams. Corp v. Carnoto, 798 So.2d 22 (Fla. 4th D.C.A. 2001). Pesut v. Miller, supra.

16 615 So.2d 760 (Fla. 4th D.C.A. 1993).

17 Committee Note to Fla. Probate R. 5.697.

18 Compare subsections (b) and (c) of Rule 1.490 with subsections (b) and (c) of Rule 5.697.

19 Fed. R. Civ P. 53(a)(1).


20 See e.g., United States v. Raddatz, 447 U.S. 687 (1980) (appointment upheld where magistrate judge had no

independent authority to enforce orders, and dispositive decisions on the law and facts were reviewed de novo on the

record).

21 See Thomas v. Union Carbide Agricultural Products Co., 473 U.S. 568, 584 (1985), and Northern Pipeline

Construction Co. v. Marathon Pipe Line Co., 458 U.S. 50 (1982).

22 The Academy of Court-Appointed Masters (ACAM) was created in 2004 at a conference sponsored by the National

Arbitration Forum. ACAM has completed a handbook that contains sample appointment orders, as well as numerous

useful references and appendices. The title is Appointing Special Masters and Other Judicial Adjuncts: A Handbook for

Judges. First published March 2004, the handbook may be downloaded from the ACAM website:

www.courtappointedmasters.org. (last visited February 23, 2007).

23 This is consistent with the requirements for general magistrates under Fla. Fam. Law R. P. 12.490 and Fla. Probate

Rule 5.697(a).

24 See generally Quee v. Breed, 165 So. 56 (Fla. 1936) and Lyle, et al v. Hunter, 136 So. 633 (Fla. 1931).

25 Rule 37 relates to failures to make discovery and the consequences for such failures. Rule 45 deals with failures to

comply with supoenae.

26 See Gray v. State of Florida, supra. (A “general or special master” appointed by Seminole County to hear a child

support case found the father in contempt by virtue of arrearage and ordered him jailed. The father resisted and was

ultimately convicted of battery and resisting arrest. The appellate court reversed the conviction, holding that the master

was without authority to order the arrest.)

27 Tucker v. Diodato, 321 So.2d 569 (Fla. 4th D.C.A. 1975) (a special master appointed for the purpose of presiding over

an involuntary hospitalization under the Baker Act ordered the Petitioner hospitalized.).

28 Authors Comment to Fla. R. Civ. P. 1.490.

29 Id.

30 De Clements v. De Clements, 662 So.2d 1276, 1279 (Fla. 3rd D.C.A. 1995); See James S. DeGraw, Rule 53, Inherent

Powers, and Institutional Reform: The Lack of Limits on Special Masters, 66 N.Y.U. L. Rev. 800, 800-01 (1991).

31 Administrative Office of the U.S. Courts, Amendments to the Federal Rules of Civil Procedure, 215 F.R.D. 158, 328

(2003).

32 Berkheimer v. Berkheimer, 466 So.2d 1219 (Fla. 4th D.C.A. 1985).


33 De Clements v. De Clements, supra at 1282; Bell v. Bell, supra at 914 (A fascinating aspect of this case is that the trial

judge appointed a special master to rule on exceptions that a party had filed to a report of the general master. The

appellate court found this to be an impermissible delegation of judicial power.)

34 Id.

35 See Mahan v. Mahan, 88 So.2d 545, 547 (Fla. 1956); Lyon v. Lyon, 54 So.2d 679, 680 (1951); Harmon v. Harmon, 40

So.2d 209 (1949); and Kent v. Knowles, 133 So. 315, 316 (Fla. 1931).

36 See Cerase v. Dewhurst, 935 So.2d 575, 578 (Fla. 3rd D.C.A. 2006); Robinson v. Robinson, 928 So.2d 360 (Fla. 3rd

D.C.A. 2006); Carlson v. Carlson, 696 So.2d 1332, 1333 (Fla. 4th D.C.A. 1997);

37 See In Re: The Guardianship of Anne Ruppert, 787 So.2d 925, 926 (Fla. 2d D.C.A 2001); Ares v. Cypress Park

Gardens Homes I Condominium Assn; 696 So.2d 885, 887 (Fla. 2d D.C.A. 1997); and De Clements v. De Clements,

supra at 1282.

38 736 So.2d 49, 50 (Fla. 5th D.C.A. 1999).

39 De Clements v. De Clements, supra at 1282.

40 See Ben-Hain v. Tacher, 418 So.2d 1107 (Fla. 3d D.C.A. 1982) overruled by De Clements v. De Clements, supra at

1284.

41 Boalt v. Boalt, 672 So.2d 109 (Fla. 4th D.C.A. 1996) and De Clements v. De Clements, supra.

42 See generally Mark A. Fellows and Roger S. Haydock, supra at 1280-1282.

43 Mark A. Fellows and Roger S. Haydock, supra at 1283.

44 See Novartis Pharms. Corp. v. Carnoto, 837 So.2d 1127, 1129 (Fla. 4th D.C.A. 2003).

45 See generally Robert H. Thornburg, Electronic Discovery in Florida, The Florida Bar Journal (October 2006) 46 Amendments to the Federal Rules of Civil Procedure, available at: www.uscourts.gov/rules/Ediscovery (last visited February 19, 2007). 47 Robert H. Thornburg, supra 36. Howard R. Marsee serves as a special master, mediator and arbitrator with the ADR group of Upchurch Watson White & Max, with offices at Maitland, Daytona Beach and Miami, Florida, as well at Birmingham, Alabama. He is a member of the national Academy of Court-Appointed Masters. He received his B.A. degree with honors from University of South Florida, and his J.D. degree with honors from the University of Florida. At the University of Florida he served on the Law Review and was a member of The Order of the Coif. He was formerly a board certified civil trial attorney with the law firm of Hannah, Marsee and Voght, P.A. in Orlando, Florida.

William Mitchell Law Review

| Issue 3Volume 31 Article 16

2005

Special Masters in State Court Complex Litigation:An Available and Underused Case ManagementToolLynn Jokela

David F. Herr

This Article is brought to you for free and open access by the Law Reviews and Journals at Mitchell Open Access. It has been accepted for inclusion inWilliam Mitchell Law Review by an authorized administrator of Mitchell Open Access.

Recommended CitationJokela, Lynn and Herr, David F. (2005) "Special Masters in State Court Complex Litigation: An Available and Underused CaseManagement Tool," William Mitchell Law Review: Vol. 31: Iss. 3, Article 16.Available at: http://open.wmitchell.edu/wmlr/vol31/iss3/16

http://open.wmitchell.edu/wmlr

http://open.wmitchell.edu/wmlr/vol31/iss3

http://open.wmitchell.edu/wmlr/vol31

http://open.wmitchell.edu/wmlr/vol31/iss3/16

3/18/2005 2:31:27 PM

1299

SPECIAL MASTERS IN STATE COURT COMPLEX LITIGATION: AN AVAILABLE AND UNDERUSED CASE

MANAGEMENT TOOL

Lynn Jokela† and David F. Herr††

I. INTRODUCTION.................................................................... 1299 II. CURRENT USE OF JUDICIAL MASTERS IN STATE AND

FEDERAL COURTS................................................................. 1300 A. Benefits Provided by Special Masters.......................... 1302 B. Actual Use of Special Masters in State Courts ............ 1303 III. ASSESSMENT OF SPECIAL MASTERS’ CONTRIBUTIONS.......... 1311 A. Drawbacks .................................................................... 1311 B. Successes ...................................................................... 1313 IV. NEED FOR SPECIAL MASTERS................................................ 1314 A. Financial and Workload Crises in the Courts............. 1314 B. State Courts’ Response–Common Cases .................... 1319 C. Complex Cases............................................................. 1320 D. State, Federal Coordination........................................ 1323 V. THE FUTURE ........................................................................ 1324 SPECIAL MASTER AUTHORITIES APPENDIX .......................... 1325

I. INTRODUCTION

Judicial masters have an honored place in the American judicial system.1 Masters are regularly used in the highest court of the land, and provide a valuable service to the operation of the

† J.D. Candidate 2005, William Mitchell College of Law; MBA, University of Wisconsin, Madison, 1989. †† Partner at Maslon, Edelman, Borman, & Brand, L.L.P.; Elected Member of the American Law Institute; current President of the American Academy of Appellate Lawyers. David F. Herr has served as special master in state and federal court antitrust, consumer fraud, and tort cases. 1. See Ex parte Peterson, 253 U.S. 300, 312 (1920) (providing in a decision written by Justice Brandeis that courts have inherent power to appoint special masters to aid judges in the performance of judicial duties).

1

Jokela and Herr: Special Masters in State Court Complex Litigation: An Available a

Produced by The Berkeley Electronic Press, 2005

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1300 WILLIAM MITCHELL LAW REVIEW [Vol. 31:3

Court.2 Masters also have an important role—and a greater potential to contribute—in litigation in the trial courts. The breadth of roles served by special masters is reflected by the number of names used to describe their role; names include “auditors, assessors, appraisers, commissioners, examiners, monitors, referees, and trustees.”3 Under state law, receivers may also serve a special master-like role. This expansive definition is used by the Federal Judicial Center (FJC) in its study of special masters,4 and use of the term “special master” in this article includes those roles.

Generally, masters have been used more extensively in federal court litigation, although they are often put to use in the state courts as well. Particularly in state court litigation, however, there are both opportunities and needs for the litigation benefits masters can provide. Indeed, because state court judges may not have magistrate judges or other resources available, special masters may be very valuable to state court judges.

This article examines the role masters have played in litigation and explores the benefits that might be obtained from the greater use of masters in the future. The FJC survey of federal judges appointing special masters concluded that special masters were “extremely or very effective.”5 The FJC study is an empirical survey of the effectiveness of special masters, and it includes commentary from judges regarding their experience after appointing special masters.6 These benefits include better, faster, and fairer resolution of litigation in the cases in which masters are used, as well as an easing of the burdens these cases place on the judiciary. This article also analyzes the barriers to the use of masters and how they might be removed.

II. CURRENT USE OF JUDICIAL MASTERS IN STATE AND FEDERAL COURTS

Rule 53 of the Federal Rules of Civil Procedure (F.R.C.P. Rule

2. See generally ROBERT L. STERN ET AL., SUPREME COURT PRACTICE § 10.12 (8th ed. 2002). 3. Thomas E. Willging et al., Special Masters’ Incidence and Activity, FED. JUD. CENTER 1 (2000) [hereinafter FJC Study], available at http://www.fjc.gov/newweb/ jnetweb.nsf/autoframe?openform&url_r=pages/556&url_l=index. 4. Id. 5. Id. at 58. 6. Id.

2

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53) allows courts to appoint a special master to perform or manage certain aspects of a case, if consented to by the parties.7 It is becoming almost commonplace in complex federal court cases for special masters to be appointed as mediators or facilitators of other alternative dispute resolution processes.8 In 2003, F.R.C.P. Rule 53 was amended to allow courts to appoint special masters to assist with pretrial and post-trial work.9 When courts appoint a special master to address pretrial or post-trial matters, it is usually because the court cannot efficiently address the matter.10 Use of special masters also arises when a matter requires protracted fact finding,11 for example, the making of a difficult damages computation.12

State court rules governing procedural aspects of a case vary from state to state. Twenty-three states have a rule of civil procedure that nearly mirrors the pre-2003 amended F.R.C.P. Rule 53.13 Twenty-four states have a rule of civil procedure that differs from F.R.C.P. Rule 53, the current rule, and the pre-2003 amended version of the rule, primarily by not including the F.R.C.P. Rule 53 language stating that appointment of a special master should be the “exception and not the rule.”14 Some states allow for

7. FED. R. CIV. P. 53(a)(1)(A). 8. See generally In re Kensington Int’l Ltd., 368 F.3d 289 (3d Cir. 2004); United States v. Yonkers Bd. of Educ., 29 F.3d 40 (2d Cir. 1994). 9. FED. R. CIV. P. 53(a)(1)(C); see also Shira A. Scheindlin & Jonathan M. Redgrave, Revisions in Federal Rule 53 Provide New Options for Using Special Masters in Litigation, 76 N.Y. ST. B.J. 18, 21-22 (Jan. 2004), available at http://www1. jonesday.com/FILES/tbl_s31Publications/FileUpload137/1086/Revisions_in_Federal_Rule_53.pdf (discussing the 2003 changes to Federal Rule 53 and how the amendments conform the rule to actual practice). 10. FED. R. CIV. P. 53 advisory committee’s note to 2003 amendments; see also MANUAL FOR COMPLEX LITIGATION (FOURTH) § 11.52 (2004) [hereinafter MANUAL] (noting that courts will appoint special masters when the amount of discovery work will impose an undue burden on the judge). 11. FED. R. CIV. P. 53(a)(1)(B). 12. FED. R. CIV. P. 53(a)(1)(B)(ii). 13. See infra Special Master Authorities Appendix (comparing state court rules (by state) to the federal rule). Alabama, Arizona, Colorado, District of Columbia, Hawaii, Idaho, Indiana, Iowa, Maine, Massachusetts, Minnesota, Missouri, Montana, Nevada, New Mexico, North Dakota, Rhode Island, South Dakota, Texas, Utah, Vermont, Wisconsin, and Wyoming have all adopted a rule similar (some may contain minor modifications) to the pre-2003 amended version of the federal rule. Id. 14. See id. (comparing state court rules (by state) to the federal rule and noting additional requirements, such as written consent of the parties). Alaska, California, Delaware, Florida, Georgia, Kansas, Louisiana, Maryland, Michigan, Mississippi, Nebraska, New Hampshire, New Jersey, New York, North Carolina, Ohio, Oklahoma, Oregon, Pennsylvania, South Carolina, Tennessee, Virginia,

3



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appointment of a special master but limit the scope of when a special master can be appointed.15 At least one state authorizes the use of a special master under a state constitutional provision.16 Nevertheless, most states provide some procedure, whether by statute or as part of the state court rules of civil procedure, that allows courts to appoint special masters to handle certain aspects of litigation.17 In fact, Illinois is the only state that does not have any mechanism governing appointment of special masters.18

A. Benefits Provided by Special Masters

State courts employ special masters to serve a variety of objectives. The objective of some state courts is to alleviate some of the caseload problems.19 The sheer magnitude of a complex case may overwhelm the time available to a judge who has other cases on the docket. Conducting in camera review of documents to review claims of privilege might take weeks or months of time, and many judges cannot fairly absent themselves from their other cases to devote this amount of time to a single case. Other courts appoint special masters to preside over discovery motions involving highly specialized issues.20 A special master will assist the parties in

Washington, and West Virginia all have a rule that does not include the language providing the appointment of a special master should be the “exception and not the rule.” Id. 15. See id. Arkansas, Maryland, and Michigan limit appointment to non-jury actions, while Connecticut currently allows appointment in family law matters as part of a civil matter pilot program scheduled to end in December 2004. Id. Kentucky limits appointment to matters involving judicial sales, and settlement and receivership, while Vermont limits appointment to actions requiring account/voucher investigation. Id. 16. MICH. CONST. art. VI, § 23. 17. See infra Special Master Authorities Appendix. 18. Id. Even in the absence of express rule authority, courts may have some inherent authority to appoint a special master. See Mitan v. New World Television, Inc., No. 225530, 2002 WL 31928598, at *6 (Mich. Ct. App. Nov. 12, 2002), rev’d, 669 N.W.2d 813 (Mich. 2003) (reversing and remanding a decision by the Michigan Court of Appeals where the court of appeals concluded the district court erred in appointing a special master under the Michigan Constitution). 19. In re Pub. Law No. 305 & Pub. Law No. 309, 334 N.E.2d 659, 666 (Ind. 1975). 20. See MANUAL, supra note 10 (stating that special masters are increasingly appointed because they bring expertise in areas of “accounting, finance, science, and technology”); JUDICIAL COUNCIL OF CALIFORNIA, DESKBOOK ON THE MANAGEMENT OF COMPLEX CIVIL LITIGATION § 2.05 (Matthew Bender 2003) [hereinafter CALIFORNIA DESKBOOK] (stating that a master may bring technical expertise or first-hand litigation experience in similar matters to bear on such

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developing a discovery plan that is both logical and cost effective.21 Construction defect suits present many difficult factual issues

and create unique settlement problems.22 Initial case management is therefore important, and often courts will enlist the help of a special master.23 A special master can help resolve problems regarding sequencing of different types of discovery, manage interim settlement negotiations between the many parties, and resolve discovery disputes.24

Aside from pretrial work, some courts use special masters to assist with settlement negotiations.25 In complex litigation matters, parties often select attorneys for their expertise at litigating.26 Judges therefore suggest that special counsel or special masters preside over settlement discussions and in “post-settlement claims-resolution proceedings.”27

B. Actual Use of Special Masters in State Courts

Many state courts have realized the benefits of appointing special masters to assist in case management. The following list provides a broad overview of state courts’ use of special masters over the past three years. Undoubtedly, state courts have used special masters in a much broader range of cases; however, the following list provides a representative sampling of state court cases documenting use of a special master.

• Presiding over attorney professional responsibility

violation proceedings.28 • Overseeing or monitoring discovery.29

issues). 21. CALIFORNIA DESKBOOK, supra note 20. 22. Id. § 3.10. 23. Id. § 3.13. 24. Id. 25. Id. § 2.92. 26. Id. 27. Id. 28. See Ligon v. Dunklin, No. 04-661, 2004 WL 2036927, at *1 (Ark. Sept. 9, 2004) (appointing a special master to preside over disbarment proceedings); In re Rutherford, 569 S.E.2d 840 (Ga. 2002) (adopting the special master’s recommendation that the court accept attorney’s petition for voluntary surrender of his license to practice law); In re Meagher, 681 N.W.2d 145, 147 (Wis. 2004) (appointing a referee to preside over hearing regarding attorney’s petition for reinstatement of license to practice law). 29. See Leo’s Gulf Liquors v. Lakhani, 802 So. 2d 337, 338 (Fla. Dist. Ct. App.

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• Conducting in camera document inspection.30 • Supervising class notice process.31 • Overseeing employment promotion practices within a

city fire department.32 • Presiding over divorce proceedings.33

o Overseeing discovery. o Determining spousal income for purposes of

spousal support. o Determining value of marital estate. o Preserving the martial estate. o Determining depletion amount of marital assets.

• Making child support determinations.34 • Modifying a child support order.35 • Making findings of fact and recommendations

regarding property disputes.36

2001) (appointing a special master to preside over discovery in a negligent misrepresentation claim for the sale of a business where discovery continued over a three-year period); Lipco Elec. Corp. v. ASG Consulting Corp., No. 8775/01, slip op. 50967U, 2004 WL 1949062 (N.Y. Sup. Ct. Aug. 18, 2004) (appointing a referee to supervise, monitor, and schedule discovery including document protection orders, and any other discovery issue that might arise); see also Ron Kilgard, Discovery Masters When They Help—and When They Don’t, 40 ARIZ. ATT’Y 30 (Apr. 2004) (discussing use of discovery masters); Janet Griffiths Peterson, The Appointment of Special Masters in High Conflict Divorces, 15 UTAH B.J. 16 (Aug./Sept. 2002) (discussing use of special masters in divorce cases). 30. Gaton v. Health Coalition, Inc., 774 So. 2d 59, 60 (Fla. Dist. Ct. App. 2000). 31. Edwards v. Long Beach Mortgage Co., No. CT 02-16446, 2004 WL 2137824, at *7 (Minn. Dist. Ct. July 22, 2004). 32. See Broadnax v. City of New Haven, 851 A.2d 1113, 1119 (Conn. 2004) (affirming the trial court’s decision to appoint a special master to oversee the promotion practices of New Haven’s fire department after repeated allegations of affirmative action violations among others). 33. See Hough v. Hough, 92 P.3d 695, 698 (Okla. 2004) (appointing a special master to assist with divorce proceeding because one party was continuously uncooperative); In re Marriage of Petropoulos, 110 Cal. Rptr. 2d 111, 115-16 (Cal. Ct. App. 2001) (appointing special master to determine debts and assets of the parties, income of the parties, and the parties’ credibility). 34. See Eberhardt v. Eberhardt, 672 N.W.2d 659, 664 (N.D. 2003) (sending determination of party’s request to increase child support to a judicial referee). 35. See Lasker v. Johnson, 123 S.W.3d 283, 286 (Mo. Ct. App. 2003) (appointing a special master after one party attempted to modify a child support order without circuit court approval). 36. See Gilbert v. Nicholson, 845 So. 2d 785, 787 (Ala. 2002) (appointing a special master to inspect and oversee roadway construction); Watkins v. Hartwell R.R. Co., 597 S.E.2d 377, 378 (Ga. 2004) (appointing a special master to resolve a right-of-way dispute between a railroad and a property owner making

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• Overseeing environmental restoration project.37 • Overseeing the winding up of a general partnership.38 • Making insurance coverage determinations.39 • Presiding over evidentiary hearings.40 • Presiding over a judicial misconduct action.41 • Determining facts in a mortgage foreclosure action.42 • Conducting preferential lien hearings.43 • Calculating attorney fees.44

improvements to the disputed property); Libby v. Vachon, No. CV-02-651, 2004 WL 1433690, at *1 (Me. Super. Ct. Apr. 22, 2004) (appointing a referee to preside over a dispute where one party constructed a culvert diverting water to neighbor’s property and neighbor subsequently blocked the culvert); Young v. Hayward, No. RE-01-35, 2003 WL 21957120, at *3 (Me. Super. Ct. July 31, 2003) (appointing a referee to decide a case involving contaminated well water where the parties could not agree on the cause or the settlement terms); Fisher v. Cranberry Township Hearing Bd., 819 A.2d 181, 183 (Pa. Commw. Ct. 2003) (appointing a referee to conduct hearings, review evidence, and make findings of fact regarding property rezoning); Houston v. Mounger, No. E2002-00779-COA-R3-CV, 2003 WL 22415363, at *1 (Tenn. Ct. App. Oct. 23, 2003) (appointing a special master as a surveyor in a property boundary line dispute). 37. See Terrebonne Parish Sch. Bd. v. Castex Energy, Inc., 878 So. 2d 522, 530 (La. Ct. App. 2004) (appointing a special master to oversee a restoration project whose duties included obtaining necessary permits, and contracting with necessary parties, which included a dredging company). 38. See Seminatore v. Climaco, Climaco, Seminatore, Lefkowitz & Garofoli, Gen. P’ship, 774 N.E.2d 1233, 1235 (Ohio Ct. App. 2002) (referring winding-up of a partnership to a special master). The FJC Study reports that a lawyer respondent to the study found that in South Carolina, use of a special master in a case accounting for partnership activity is almost “automatic.” FJC Study, supra note 3, at 74. 39. See Buller v. Minn. Lawyers Mut., 648 N.W.2d 704, 707 (Minn. Ct. App. 2002) (agreeing to refer determination whether insurance policy provided coverage to a consensual special magistrate (retired Minnesota Supreme Court justice)). 40. See Brooks v. State, 816 So. 2d 199 (Fla. Dist. Ct. App. 2002) (ordering appointment of a special master to make evidentiary findings regarding timely notice of appeal); Williams v. State, 816 So. 2d 718 (Fla. Dist. Ct. App. 2002) (requesting appointment of a special master to conduct a hearing regarding a party’s right to raise a claim of ineffective assistance of counsel). 41. See In re Anderson, 82 P.3d 1134, 1141 (Utah 2004) (appointing a special master to gather additional evidence in a juvenile court judge misconduct proceeding). 42. See United Cos. Lending Corp. v. Candela, 740 N.Y.S.2d 543, 545 (N.Y. App. Div. 2002) (ordering appointment of a referee to determine outstanding mortgage balance in a foreclosure action). 43. See Venetian Casino Resort, LLC v. Eighth Jud. Dist. Ct., 41 P.3d 327, 329 (Nev. 2002) (affirming trial court decision to appoint a special master to preside over preferential lien hearings in which the special master did not have a conflict of interest).

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Federal courts make extensive use of special masters. The

following list highlights case situations where federal courts have put special masters to work.

• Complex litigation or mass tort cases.45 • Calculating attorney fees.46 • Finding investigative facts.47 • Preparing redistricting plans for state house and

senate.48 • Acting as a trustee over a constructive trust.49 • Determining net profits due.50 • Reviewing documents for possible redaction of

privileged documents in a summary judgment motion.51

• Managing discovery disputes.52 • Conducting in camera document review.53 • Conducting evidentiary hearings in a claim under the

44. See Jan Skutch, Special Master Calls for Heads of Roberson, Woodall, LOCAL NEWS NOW, SAVANNAH MORNING NEWS, Mar. 30, 2000, at http://www. savannahnow.com/stories/033000/LOCshiggs.shtml (discussing the special master’s recommendation regarding disciplinary action against two attorneys involved in a medical malpractice case where they claimed over seventy percent of the cash portion of the patient’s settlement). See generally MANUAL, supra note 10, § 21.727 (noting that courts have broad discretion to refer issues regarding a fee amount request to a special master). 45. See In re Kensington Int’l Ltd., 353 F.3d 211, 215 (3d Cir. 2003) (appointing special masters to preside over bankruptcy proceedings in mass tort asbestos litigation); see also Bedouin L. Joseph, The “Nuts & Bolts”: The Louisiana Special Master Statute: A Valuable Tool or an Expensive and Unnecessary Diversion?, 51 LA. B.J. 261, 262 (Dec. 2003/Jan. 2004) (noting mass tort and complex litigation cases “continue to inundate [Louisiana] courts”). 46. Am. Presents, Ltd. v. Hopkins, 330 F. Supp. 2d 1217, 1234 (D. Colo. 2004). 47. See Cobell v. Norton, 310 F. Supp. 2d 102, 104 (D.D.C. 2004) (ordering a special master to investigate whether the Department of Interior concealed information). 48. Larios v. Cox, 306 F. Supp. 2d 1212, 1213 (N.D. Ga. 2004). 49. Triple Five of Minn., Inc. v. Simon, 280 F. Supp. 2d 895, 909 (D. Minn. 2003). 50. Id. 51. Diversified Group, Inc. v. Daugerdas, 304 F. Supp. 2d 507, 510 (S.D.N.Y. 2003). 52. Good Stewardship Christian Ctr., Inc. v. Empire Bank, 341 F.3d 794, 797 (8th Cir. 2003). 53. In re Omeprazole Patent Litig., 2004 WL 842024, at *1 (S.D.N.Y. 2004).

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National Childhood Vaccine Injury Act.54 • Determining necessary relief in Voting Rights Act

matter.55 • Reviewing attorney fee applications in class action

litigation.56 In addition to reported decisions, an empirical study created

by FJC studied federal courts’ use of special masters.57 The FJC Study also found non-attorney special masters’ activities included testifying to a jury, establishing a claims process, recommending approval of or implementing a settlement, and drafting an enforcement decree.58

Federal courts recognize the benefits that special masters offer, and the courts continue to appoint masters to manage difficult and complex issues.59 Many resources used by federal courts are also used extensively within state courts.60 Like federal courts, state courts should appoint special masters to manage difficult or complex issues. In many situations, state court and federal court litigation is indistinguishable and often involves the same issues and the same attorneys.61 Both federal and state court rules permit courts to appoint special masters.62 State courts should take greater advantage of the discretion allowed under the rules and appoint special masters to difficult matters.

State courts’ use of special masters may be limited by various

54. Dixon v. Sec’y. of Dep’t of Health & Human Servs., 61 Fed. Cl. 1, 6 (2004). 55. United States v. Berks County, Pa., 250 F. Supp. 2d 525, 542 (E.D. Pa. 2003). 56. In re Prudential Ins. Co. of Am. Sales Practice Litig. Agent Actions, 278 F.3d 175, 184 (3d Cir. 2002). 57. FJC Study, supra note 3. 58. Id. at 41. 59. See MANUAL, supra note 10 (noting that the Federal Rules of Civil Procedure allow judges to appoint special masters when pretrial and post-trial matters cannot be efficiently and effectively addressed by a judge, particularly in cases requiring accounting, finance, science, and technology expertise); see also FJC Study, supra note 3, at 13 (showing that in 1506 cases out of 445,729 docket entries, the court made some entry to a special master). 60. See DAVID F. HERR, ANNOTATED MANUAL FOR COMPLEX LITIGATION (FOURTH) 3 (West, 2004) (noting that the Manual for Complex Litigation is used extensively by state courts). 61. See, e.g., ROGER HAYDOCK & JOHN SONSTENG, TRIAL ADVOCACY BEFORE JUDGES, JURORS, AND ARBITRATORS § 1.1 (Thomson West, 3d ed. 2004). 62. See supra notes 13-14 and accompanying text.

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hurdles or standards inherent in the authorities allowing state courts to appoint a special master.63 Some of the conditions or limitations include:

• Requiring consent of the parties before appointing a

special master.64 • Requiring a finding of an extraordinary need.65 • Limiting the scope of cases permitting appointment of

a special master.66 • Limiting appointment to non-jury actions.67 • Requiring that an action to be tried to a jury involve

“examination of complex or voluminous accounts.”68 Nevertheless, state courts can put special masters to work, and such limitations should not stand in the way of utilizing special masters when allowed.

In state courts, a contentious divorce proceeding, such as one involving custody issues, is one situation where the court may appoint a special master to make decisions regarding “day-care, . . . diet, . . . discipline, health care, and daily routines.”69 Any decisions the special master makes regarding “education, religious training, vacations and holidays, supervision of visitation, and participation in physical and psychological examinations” would require adoption by the court.70 The court’s goal in appointing a special master to a divorce/custody proceeding is to protect the child from ongoing litigation and parental conflict.71

Courts can also appoint special masters to resolve complex calculations. Special masters hear evidence and make damages recommendations regarding the fair market value of property.72 In one case, the court noted that appointment of a special master might be useful in determining the value of improvements to a

63. See infra Special Master Authorities Appendix (listing the authorities by state and stating some of the authorities’ limitations). 64. FLA. STAT. ANN. R.C.P. RULE 1.490 (West 2004 & Supp. 2005). 65. TEX. R. CIV. P. 171. 66. CONN. R. SUPER. CT. PROC. FAMILY MATTERS § 25-53. 67. MD. CIR. CT. R. CIV. P. 2-541. 68. KAN. STAT. ANN. § 60-253 (1994 & Supp. 2002). 69. Griffiths Peterson, supra note 29, at 18. 70. Id. 71. Id. 72. McKemie v. City of Griffin, 537 S.E.2d 66, 67 (Ga. 2000).

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water system.73 In another case, the trial court appointed a special master to make an accounting of a company’s books and bank accounts.74 Special masters help determine amounts due under rental agreements.75 When a case involves a dispute regarding attorneys’ fees and the court appoints a special master, the special master can offer recommendations that might include disbarment.76

Cases involving school funding are one area where several state courts have appointed special masters. In Arkansas, the school-funding program was declared unconstitutional.77 Since the DuPree decision, several cases have again challenged revisions to the state’s educational-funding program.78 In 2002, the Arkansas Supreme Court once again declared the state-funding program unconstitutional.79

After the state missed a January 2004 deadline where it was to complete a cost study and propose a funding program that is constitutional, the court appointed two special masters.80 The special masters were to answer ten questions related to steps the state had taken to bring the educational system into compliance with the state’s constitution.81 The Arkansas Supreme Court discussed the anticipated work of the special masters and noted that it would primarily involve document review.82 Nevertheless, the court mentioned that if the masters determined that they needed to take testimony, the masters had the authority to subpoena witnesses or other materials.83 In April 2004, the masters released their report (128 pages) and noted their findings with respect to the state’s action in bringing the educational system into

73. Hi-Country Estates Homeowners Ass’n v. Bagley & Co., 928 P.2d 1047, 1052 n.5 (Utah Ct. App. 1996). 74. See HRR Ark., Inc. v. River City Contractors, Inc., 87 S.W.3d 232, 235-36 (Ark. 2002) (noting that the trial court appointed a special master where the case involved a dispute about a sale of assets with provisions related to adjustments for revenue shortfalls, and the parties asserted counterclaims for unpaid commissions and unpaid rent). 75. Fallahzadeh v. Ghorbanian, 82 P.3d 684, 685 (Wash. Ct. App. 2004). 76. Skutch, supra note 44. 77. DuPree v. Alma Sch. Dist. No. 30, 651 S.W.2d 90 (Ark. 1983). 78. Tucker v. Lake View Sch. Dist. No. 25, 917 S.W.2d 530 (Ark. 1996); Magnolia Sch. Dist. No. 14 v. Ark. State Bd. of Educ., 799 S.W.2d 791 (Ark. 1990). 79. Lake View Sch. Dist. No. 25 v. Huckabee, 91 S.W.3d 472 (Ark. 2002). 80. Lake View Sch. Dist. No. 25 v. Huckabee, 144 S.W.3d 741 (Ark. 2004). 81. Id. at 742. 82. Id. at 742-43. 83. Id.

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compliance with the state constitution.84 Courts in Idaho, Kentucky, New Jersey, New Mexico, New York, and West Virginia have also appointed special masters to cases involving school-funding programs.85

Courts often appoint a special master to cases involving property disputes. In New Jersey, a court appointed a special master to recommend the number of housing units that a development lot could yield while complying with a zoning ordinance.86 In another New Jersey case, the court appointed a special master to assist in revising a zoning ordinance at issue in a land use regulation case.87 In Arizona, a court appointed a special master to a matter involving violations of a subdivision’s covenants, conditions, and restrictions.88 The special master heard testimony, conducted an on-site visit, and found that one of the parties did violate the subdivision’s covenants, conditions, and restrictions.89 The trial court adopted the special master’s recommendations and findings, and the appellate court affirmed the decision.90 State courts in California, Florida, Massachusetts, Michigan, Texas, and Washington have appointed special masters to assist in resolving property disputes ranging from zoning ordinance disputes to disputes concerning defective construction.91

84. Lake View Sch. Dist. No. 25 v. Huckabee, No. 01-836, 2004 WL 1406270, at *1 (Ark. June 18, 2004); see also Molly A. Hunter, Special Masters Report on Compliance in Arkansas, Offer Favorable Views on Early Childhood Education and Consolidation, ACCESS (April 7, 2004), at http://www.schoolfunding.info/states/ar/4-7-04mastersreport.php3 (discussing the special masters’ findings regarding the Arkansas school-funding program). 85. Hunter, supra note 84; see Idaho Sch. for Equal Educ. Opportunity v. State, 97 P.3d 453, 456 (Idaho 2004) (noting the district court’s appointment of a special master to assess dilapidated schools in the state); Rose v. Council for Better Educ. Inc., 790 S.W.2d 186 (Ky. 1989); Abbott v. Burke, 710 A.2d 450 (N.J. 1998); State ex rel. Justice v. Bd. of Educ., 539 S.E.2d 777 (W. Va. 2000); State Court Appoints Three Special Masters to Fix School Funding Formula, NY1 NEWS (Aug. 4, 2004), at http://www. allianceforqualityeducation.org/State%20court%20appoints%203%20masters.html. 86. Toll Bros. v. Township of W. Windsor, 803 A.2d 53, 66 (N.J. 2002). 87. S. Burlington County NAACP v. Mount Laurel Township, 456 A.2d 390, 454-55 (N.J. 1983). 88. Ahwatukee Custom Estates Mgmt. Ass’n v. Turner, 2 P.3d 1276, 1278 (Ariz. Ct. App. 2000). 89. Id. 90. Id. 91. Regan Roofing Co. v. Superior Court, 27 Cal. Rptr. 2d 62 (Cal. Ct. App. 1994); Clay v. Monroe County, 849 So. 2d 363 (Fla. Dist. Ct. App. 2003); Yankee

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III. ASSESSMENT OF SPECIAL MASTERS’ CONTRIBUTIONS

Cases where courts have appointed special masters have been met with success and complaints. Courts frequently adopt the special master’s recommendations. Nevertheless, a losing party often appeals a court’s decision where it adopts a recommendation by a special master.

A. Drawbacks

Expense is one area that some view as a drawback related to use of special masters.92 Whether expense is incurred by the parties or by the court, use of special masters may result in incurring additional expense.93 Nevertheless, the reality is that efficiencies brought about by special masters ultimately save money for the parties and save public resources.94

Cases where parties question the special masters’ recommendations or findings often involve situations where a party asserts that the special master heard an argument raised for the first time on appeal.95 More often than not, the appellate court affirms the trial court decision because transcripts of the hearing before the special master are not available.96

Decisions where the appellate court vacates the findings of a special master have occurred when the trial court appointed a special master without the consent of the parties.97 In Missouri, a trial court adopted an accountant’s report as a report of a special master purportedly in accordance with Missouri Rule of Civil

Adver. Co. v. Outdoor Adver. Bd., 464 N.E.2d 410 (Mass. App. Ct. 1984); Northview Constr. Co. v. City of St. Clair Shores, 249 N.W.2d 290 (Mich. 1976); City of Garland v. Walnut Villa Apartments, L.L.C., No. 05-01-00234-CV, 2001 WL 789298, at *1 (Tex. App. July 12, 2001); Peterson v. Koester, 92 P.3d 780 (Wash. Ct. App. 2004). 92. FJC Study, supra note 3, at 59. 93. Id. 94. Id. 95. See Simmons v. Bearden, 596 S.E.2d 136, 137 (Ga. 2004) (arguing on appeal that the special master’s determination was based on issues “neither considered nor ruled on below”); Gotel v. Thomas, 592 S.E.2d 78, 79-80 (Ga. 2004) (noting that the appellate court could not review the argument that the special master erred by considering an argument first raised on appeal because no transcript of the hearing before the special master was available). 96. See Simmons, 596 S.E.2d at 137; Gotel, 592 S.E.2d at 79-80. 97. Perez-Vasquez v. Smith-Rivera, No. 3D03-3256, 2003 WL 23006699, at *1 (Fla. Dist. Ct. App. 2003).

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Procedure 68.01.98 The appellant argued that the trial court erred in adopting the report, and the court of appeals agreed with the appellant.99 The court of appeals noted that the trial court did not provide notice to the appellant that it was appointing the accountant as a special master, the accountant was not sworn in, and the appellant never had an opportunity to challenge the accountant’s report.100 Consequently, the Missouri Court of Appeals stated that the accountant’s report could not be considered on remand.101

Parties have appealed appointment of a special master in jurisdictions that limit the appointment of a master to unusual or exceptional cases.102 If the trial court fails to make findings of the required condition precedent to use of a master, disqualification may be appropriate.103 In most such situations, however, the reviewing court will readily determine that sufficient grounds existed for appointment of a master, even if they were not specifically found in the order of appointment.104 In one Texas case, a party challenged the trial court’s appointment of a special master for discovery on the grounds that the trial court did not have “good cause” to appoint the master.105 In reviewing the matter, the Texas Court of Appeals noted that a trial court’s decision to appoint a special master is within the court’s discretion but should only occur when there is “good cause.”106 On review, the court of appeals noted that the case only involved two plaintiffs and one defendant.107 Moreover, the court noted that neither party made a contention that the case was overly complicated.108 The court concluded that the case was not exceptional and that the trial court did not show good cause when deciding to refer discovery matters to a master.109

98. Shaner v. Sys. Integrators, Inc., 63 S.W.3d 674, 679 (Mo. Ct. App. 2001). 99. Id. 100. Id. 101. Id. 102. See, e.g., Wallin v. Drewery, 783 So. 2d 786 (Miss. Ct. App. 2001); Tollett v. Carmona, 915 S.W.2d 562 (Tex. App. 1995). But see Venetian Casino Resort, L.L.C. v. Eighth Judicial Dist. Court of Nev., 41 P.3d 327 (Nev. 2002). 103. See, e.g., Tollett, 915 S.W. 2d at 563. 104. Wallin, 783 So. 2d at 790. 105. Tollett, 915 S.W.2d at 563. 106. Id. at 564. 107. Id. 108. Id. 109. Id.

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Challenges to a court’s appointment of a special master also occur when a party believes the special master has a conflict of interest. Often times, a party will need to show that the perceived conflict of interest is more than speculation.110 Nevertheless, if a legitimate conflict of interest exists, special masters should recuse themselves from a proceeding.111 Parties should be aware that special masters are frequently attorneys and that accommodations should be made to limit the special master’s role in the proceeding so as to avoid any possible conflict of interest.

B. Successes

Although the FJC Study is anecdotal in nature, it notes great satisfaction in the work special masters do and how federal judges view the special masters’ work.112 The work of special masters is very helpful; in fact, one judge in responding to the FJC Study “wished he had appointed a discovery master earlier.”113 The FJC Study shows that generally, judges appointing special masters thought that the “benefits of appointments outweighed any drawbacks.”114

In a case involving allegations of damages from lead-based paint, a special master was able to determine that the alleged damages occurred after the paint manufacturer stopped selling lead-based paint.115 The special master recommended dismissal of the case based on a variety of legal theories, and the trial court judge adopted the special master’s recommendations.116

The work of special masters has also been successful when the work involves “side issues” or general research for the court. The Pennsylvania Supreme Court appointed a special master to gather data regarding death penalty cases in the state.117 The court was

110. Wallin, 783 So. 2d at 790. 111. But see Venetian Casino Resort, L.L.C. v. Eighth Judicial Dist. Court of Nev., 41 P.3d 327 (Nev. 2002) (noting that despite the fact the plaintiff waived its right to object to the special master appointment, the concerns of the plaintiff were not so serious for the special master to recuse herself from the proceeding). 112. FJC Study, supra note 3, at 61. 113. Id. at 64. 114. Id. at 66. 115. See Understanding Lead-Pigment Litigation, at http://www.leadlawsuits.com/ infobystate_MS.htm (last visited Jan. 6, 2005) (noting Gaines v. Sherwin Williams). 116. Id. 117. David C. Baldus & George Woodworth, Race Discrimination and the Legitimacy of Capital Punishment: Reflections on the Interaction of Fact and Perception, 53

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studying concerns regarding race-based disparate treatment, and it needed to review evidence.118 The special master was able to gather the data, and a state commission called for a moratorium on executions.119

Special masters also provide valuable services to the court when a matter involves a highly technical dispute. For example, courts often appoint special masters to assist in resolving electronic discovery matters.120 A special master who possesses the right qualifications is in a better position to resolve the dispute as compared to a judge with little or no technical expertise.121 Special masters can help answer questions such as what is the right amount of data to produce.122 Electronic discovery disputes often involve a question of which party should bear the cost of production, and a special master is in the best position to determine the answer.123

Whether a court has appointed a special master to assist with pretrial or post-trial matters, the FJC Study shows that attorneys and judges alike thought that the special master helped manage the case more efficiently.124 Even the attorneys involved in cases where special masters were appointed thought the special masters were “effective in meeting the goals of the appointment, [and] describ[ed] the appointments as a good idea.”125

IV. NEED FOR SPECIAL MASTERS

A. Financial and Workload Crises in the Courts

Across the country, state budget crises are limiting individuals’

DEPAUL L. REV. 1411, 1441 (2004) (focusing in part “on the interaction between empirical evidence of racial discrimination in the administration of the death penalty”). 118. Id. 119. Id. at 1481. 120. Richard H. Agins, An Argument for Expanding the Application of Rule 53(b) to Facilitate Reference of the Special Master in Electronic Data Discovery, 23 PACE L. REV. 689, 694 (2003) (suggesting “that a properly qualified special master can provide substantial assistance to the court where electronic data discovery raises difficult questions related to the quantity or format of information, or to the maintenance of ongoing operations of the producing party while discovery is in progress”). 121. Id. at 718. 122. Id. at 719. 123. Id. at 723. 124. FJC Study, supra note 3, at 67. 125. Id.

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access to the courts.126 In response to budget cuts, states have temporarily suspended jury trials, closed courtrooms and courthouses, and reduced court hours.127 Other states considered taking measures that would require employees to take unpaid days off, reduce judicial education, cut court staff, and curtail court interpretation services.128

Comparing fiscal year 2002-03 to 2003-04, states experiencing some of the most significant budget cuts are reacting by cutting court support staff.129 In Massachusetts, where the court’s budget declined by 25%, courts reduced staffing by more than 1000 employees through layoffs and attrition.130 The California judicial budget decreased by 25%, and its Chief Justice outlined a series of action steps for courts to consider in managing reduced budgets.131 The action steps required a “90-day vacancy period after an employee leaves a position, and a review to see if the position can be eliminated.”132 In fact, 62% of the nation’s state courts have delayed hiring or imposed hiring freezes during the recent slowed economic period.133

126. See ABA State Court Funding Crisis, ABA Commission on State Court Funding, at http://www.abanet.org/jd/courtfunding/funding_comm.html (last visited Jan. 6, 2005) (stating that the ABA launched the “ABA Commission on State Court Funding, . . . to examine problems arising from chronic under-funding of state judicial systems”); C.J. Ronald M. George, State of the Judiciary (Mar. 23, 2004), at http://www.courtinfo. ca.gov/reference/soj0304.htm. 127. ABA State Court Funding Crisis, Summary of Issues and ABA Policies, at http://www.abanet.org/jd/courtfunding/issues.html (last visited Jan. 6, 2005) (noting Alabama temporarily suspended jury trials in 2002; Los Angeles County California closed courtrooms and courthouses; and Oregon closed courthouses on Fridays); see also Lisa Stansky, The Big Squeeze: State Legal Systems are Feeling the Pain of Tight Budgets, Special to the National Law Journal, at http://jud13.flcourts.org/ avweb/news_1.htm (last visited Jan. 6, 2005) (detailing measures taken by state courts across the country in response to budget cuts). 128. Stansky, supra note 127. 129. See State Budget Appropriations to the Judicial Branch, at http://www.abanet.org/jd/courtfunding/pdf/state_budget_tables.pdf (last visited Jan. 6, 2005) (showing double-digit budget decreases in Alabama, Arizona, California, Colorado, Massachusetts, and South Carolina); David L. Hudson, Jr., Courts’ Cash Crunch, 2 No. 3 A.B.A.J. E-Report 1 (Jan. 24, 2003) (noting Colorado had a hiring freeze); ABA State Court Funding Crisis, supra note 127. 130. State Budget Appropriations to the Judicial Branch, supra note 129; ABA State Court Funding Crisis, supra note 127. 131. C.J. Ronald M. George, Remarks on the Budget (Dec. 13, 2002), at http://www.courtinfo.ca.gov/reference/budget1202.htm. 132. Id. 133. Kenneth G. Pankey, Jr., Funding State Courts: Trends in 2002: Budget Woes and Resourceful Thinking, available at http://www.ncsconline.org/

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While budget cuts create financial management problems for the courts, the problems become more complicated as court caseloads continue to increase.134 Since 1993, state court caseloads have increased at a steady pace.135 Over the past ten years, state court civil case filings have increased 12%, criminal case filings 19%, domestic relations case filings 14%, and juvenile case filings 16%.136 It is noteworthy that state court caseloads have increased at a rate two to three times higher than the growth in the number of state court judges, which has only averaged about one-half of 1% per year over the last ten years.137 As courts react to continued financial constraints combined with increased caseloads, innovative solutions are needed to ensure that individuals have continued access to justice.138

Some of the problems in the state court system are magnified when the problems are part of a large court system such as the California court system.139 California’s state budget problems have drawn national attention.140 California courts have been forced to take drastic measures to help manage financial constraints and workload problems.141 In California, some of the effects from

WC/Publications/ KIS_FundCt_Trends02_Pub.pdf (last visited Feb. 11, 2005). 134. See Hudson, supra note 129 (noting that Oregon planned to close state courts on Fridays and lay off thirty-nine court employees with the result that courts will be unable to hear cases involving shoplifting, prostitution, criminal trespass, and vandalism); NATIONAL CENTER FOR STATE COURTS, EXAMINING THE WORK OF STATE COURTS, COURT STATISTICS PROJECT, 10 (2003), available at http://www.ncsconline.org/D_Research/csp/2003_Files/2003_Overview.pdf (showing state court civil case filings increased 12% from 1993 – 2002, and that 96.2 million new cases were filed in state trial courts in 2002). 135. See NATIONAL CENTER FOR STATE COURTS, EXAMINING THE WORK OF STATE COURTS, supra note 134, at 10 (stating combined civil, criminal, domestic relations, and juvenile case filings have increased fifteen percent since 1993). 136. Id. 137. Id. at 11. 138. See Frances Kahn Zemans, Court Funding, ABA Standing Committee on Judicial Independence 1, 11 (Aug. 2003), at http://www.abanet.org/ jd/courtfunding/ pdf/courtfunding.pdf (stating that courts’ cost-cutting measures may “affect the quality of justice and its availability to the public”). 139. JUDICIAL COUNCIL OF CAL. FACT SHEET 1 (Jan. 2003), at http://www.courtinfo. ca.gov/reference/documents/cajudsys.pdf (noting that California’s court system is the largest in the nation). 140. See JUDICIAL COUNCIL OF CAL., 2004 ANNUAL REPORT, PRESERVING EQUAL ACCESS TO JUSTICE, PROGRESS AND CHALLENGES OF THE CALIFORNIA JUDICIAL BRANCH, 3 (2004), available at http://www.courtinfo.ca.gov/reference /documents/ar2004.pdf (last visited Jan. 3, 2005) (stating that California courts face “catastrophic budget reductions due to an ailing state economy”). 141. See id. at 2 (stating that some judicial programs have been curtailed, and

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reduced budgets and increased workloads have included increases in workers compensation claims by court employees, continued court closures, increased case backlogs and service delays, and elimination of services and programs.142

In Minnesota, there is concern that funding levels have not increased proportionately to increases in caseloads.143 Of particular concern is funding for the public defender system.144 In 2004, the Minnesota public defender system faced potential layoffs of up to 40% of its staff.145 Some predict Minnesota’s judicial system could come to a halt.146

According to the ABA study of judicial branch budgets, Minnesota’s judicial budget actually increased from fiscal year 2002-03 to 2003-04.147 Although the state judicial budget increased, it only increased at an annual rate of 0.07% while the state court caseload grew at an average annual rate of 1.7%.148 Court workloads are leaving courts in search of creative solutions so that no one is denied justice.149

Increasingly, courts are making use of court referees to perform duties that are traditionally performed by a judge.150 One commentator suggests that this is the result of state legislatures

others are in danger of being eliminated); see also Blaine Corren, Hearing Documents High, Costs of Budget Cuts, CT. NEWS, May – June, 2004, at 1, available at http://www.courtinfo.ca.gov/courtnews/mayjun04.pdf (stating that some California courts are keeping vacant positions open for years and requiring mandatory furloughs, and others are cutting services). 142. Corren, supra note 141, at 1, 6. 143. James L. Baillie, Our Public Defender System: A Funding Crisis, 61 BENCH & BAR OF MINN. 5, 5 (2004). 144. Id. 145. KARE 11 News: Crisis in the Courts? (NBC affiliate television broadcast, July 18, 2004). 146. See id. (stating if layoffs become a reality, the state’s court system could grind to a halt). 147. See State Budget Appropriations to the Judicial Branch, supra note 129. 148. Id.; see also MINN. JUDICIAL BRANCH, 2003 ANNUAL REPORT 5 (2003), available at http://www.courts.state.mn.us/documents/CIO/annualreports/ 2003/mjb_annual_report_2003.pdf (showing that over the past decade, Minnesota’s case filings increased eighteen percent, which corresponds to an approximate 1.67% average annual increase). 149. See MINN. JUDICIAL BRANCH, supra note 148, at 3 (noting that due to continued caseload increases, and revenue decreases “[t]he judicial branch continues to search for alternative solutions to resolve disputes”); Corren, supra note 141, at 1 (stating that in California, due to budget cuts and reduced staffing levels, court employees need to become “generalists”). 150. See, e.g., Robert J. Sheran & Douglas K. Amdahl, Minnesota Judicial System: Twenty-five Years of Radical Change, 26 HAMLINE L. REV. 219, 233 (2003).

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failing to fund additional judicial staffing needs.151 In Nebraska, courts utilize referees in child support cases to ensure cases meet case progression standards, and in Minnesota, courts in the second and fourth judicial districts use court referees for landlord/tenant disputes.152 It is noteworthy that in Minnesota, the fourth judicial district (where referees are utilized), has the highest caseload per judge of any court in the country.153 So, as caseloads increase, courts continue to rely on judicial referees.154

Statistics show that complex litigation matters,155 and class action claim filings are on the rise.156 Court dockets continue to increase.157 One problem that state courts have is lack of legal support staff—federal court judges often employ one or more law clerks, whereas state court judges generally do not employ law

151. Id. 152. Nebraska Supreme Court Child Support Goals and Rules at 7.3-7.4, available at http://court.nol.org/rules/CHSUPPREFS.07.PDF (last visited Jan. 3, 2005); Lawrence R. McDonough, Wait a Minute! Residential Eviction Defense Is Much More Than “Did You Pay The Rent?”, 28 WM. MITCHELL L. REV. 65, 68 (2001). 153. Sheran & Amdahl, supra note 150, at 240. 154. See Probate Court Functions, at http://www.mahoningcounty probate.org/a_about_the_probate_court.htm (last visited Jan. 3, 2005) (stating that in Ohio, due to heavy caseloads, probate courts are using referees to handle cases filed with the court). 155. The term “complex litigation” has been defined many ways. Scott A. Steiner, The Case Management Order: Use and Efficacy in Complex Litigation and the Toxic Tort, 6 HASTINGS W.–NW. J. ENVTL. L. & POL’Y 71, 74 (1999). One source defines “complex litigation” as including “those cases in which the normal adversary process is impaired, and special rules, tailored to the specific litigation, must be devised if the cases are to be adjudicated and decided efficiently and fairly.” Jack Friedenthal, Tackling Complex Litigation, 74 NOTRE DAME L. REV. 1301 (1999) (reviewing JAY TIDMARSH & ROGER H. TRANGSRUD, COMPLEX LITIGATION AND THE ADVERSARY SYSTEM (1998)). 156. See Shira A. Scheindlin & Jonathan M. Redgrave, Revisions in Federal Rule 53 Provide New Options for Using Special Masters in Litigation, 76 N.Y. ST. B.J. 18, 22 (Jan. 2004) (stating that the increased occurrence of complex litigation will likely lead to increased use of special masters); Bedouin L. Joseph, The Louisiana Special Master Statute, 51 LA. B.J. 261, 262 (Dec. 2003/Jan. 2004) (noting mass tort and complex litigation cases “continue to inundate [Louisiana] courts”); Larry Kramer, Choice of Law in Complex Litigation, 71 N.Y.U. L. REV. 547, 575 (1996) (stating that state courts rarely encounter the problems of complex litigation because the cases are in federal court; however state courts do see nationwide class action suits, and such suits have reportedly increased) (citing Commentary, 18 Class Action Rep. 1, 1 (1995)). 157. See Laura J. Hines, The Dangerous Allure of the Issue Class Action, 79 IND. L.J. 567, 570-71 n.23 (2004) (noting federal and state court dockets continue to grow, resulting in delays) (citing Report of the Judicial Conference Ad Hoc Committee on Asbestos Litigation 3 (1991)).

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clerks.158 Court-appointed referees can help manage particular aspects of complex litigation matters, such as discovery disputes.159 When complex litigation matters arise in state courts, the cases often need “managerial judging.”160 In Connecticut, complex litigation matters involving real estate limited partnerships, environmental insurance litigation, and construction litigation have arisen in state courts and are examples of cases requiring managerial judging.161

B. State Courts’ Response–Common Cases

In response to concern about the pace of litigation, Connecticut established a pilot case management program.162 Connecticut’s pilot program established time standards for the disposition of civil cases.163 The program provides “discovery judges” who are assigned to individual cases and then monitor case progress.164 In addition, the program provides special masters who will primarily hear settlement conferences.165 Connecticut’s pilot program was scheduled to end in December 2004.166 Assuming the program succeeds, the judicial branch then wants to use it as a model for further deployment.167

Concerns regarding timeliness of state court dispositions

158. Lloyd Milliken, Jr., Fixing the Broken Class Action Lawsuit System, 47 RES GESTAE 19, 21 (2003). 159. Vivien B. Williamson, ADR: An Overview, 600 PRACTICING L. INST. LITIG. 707, 712 (1999) (noting referees help resolve complicated financial or technical issues, and in California they resolve discovery disputes); Steiner, supra note 155, at 80 (noting that courts can appoint a discovery referee before a discovery dispute arises). 160. Barry Schaller, Managerial Judging: A Principled Approach to Complex Cases in State Court, 68 CONN. B.J. 77, 79 (1994). 161. Id. at 79-80. 162. STATE OF CONN. JUD. BRANCH, IN RE: BRIDGEPORT PILOT PROGRAM (BPP) (2003), at http://www.jud.state.ct.us/external/super/Standorders/RaiseBar-Feb.pdf. 163. Id. 164. STATE OF CONN. JUD. BRANCH, IN RE: BRIDGEPORT PILOT PROGRAM (BPP) (2003), at http://www.jud.state.ct.us/external/super/Standorders/BPP-1P.htm. 165. STATE OF CONN. JUD. BRANCH, IN RE: BRIDGEPORT PILOT PROGRAM (BPP) (2003), at http://www.jud.state.ct.us/external/super/Standorders/RaiseBar-Feb.pdf. 166. Id. 167. But see STATE OF CONN. JUD. BRANCH, IN RE: BRIDGEPORT PILOT PROGRAM (BPP) (2005), at http://www.jud.state.ct.us/external/super/ Standorders/BPP.htm#Pilot (stating that administrative appeals of fifteen and twenty-four month cases in the BPP have been suspended).

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persist.168 The presence of complex cases directly affects a court’s average case resolution time.169 One problem that state courts encounter more frequently than federal courts is the number of criminal cases.170 When a criminal case involves a constitutional issue or a severe offense with a possible long-term incarceration, the efficiency of the court declines.171 It is noteworthy that the two states with the highest number of death penalty cases also take the most time to resolve their caseloads.172

C. Complex Cases

Federal statutes help manage caseload problems by defining how courts can aggregate cases that contain a common question of fact. After consolidating the cases, a single judge hears the case.173 Multidistrict litigation statute, 28 U.S.C. § 1407, requires that at least two cases be “pending in different districts” and “involv[e] one or more common questions of fact” before the cases may be aggregated or consolidated.174 A multidistrict litigation (MDL) panel determines whether to allow the consolidation.175 Mass tort claims are typical claims that are brought to a MDL panel for consolidation.176 State courts as well as federal courts preside over

168. See Seymour Moskowitz, Rediscovering Discovery: State Procedural Rules and the Level Playing Field, 54 RUTGERS L. REV. 595, 642 (2002) (noting that slow disposition of civil cases in state courts may be the result of the high number of criminal cases and criminal case priority, and lack of judges and court personnel); Theodore Eisenberg et al., Litigation Outcomes in State and Federal Courts: A Statistical Portrait, 19 U. SEATTLE L. REV. 433, 453 (1996) (noting that state courts’ time-to-disposition is usually greater than federal courts’ time-to-disposition). 169. See Roger A. Hanson, Brian J. Ostrom & Neal B. Kauder, Examining the Work of State Courts, CASELOAD HIGHLIGHTS (Nat’l Center for State Cts., Williamsburg, Va.), Mar. 2002, at 1, 2, available at http://www.ncsconline.org/D_Research/csp/Highlights/ COLR_Vol8No1.pdf (noting that in Florida, case resolution times are comparatively longer due to the number of complex cases in the state court system). 170. Id. 171. Id. 172. Id. 173. DAVID F. HERR, MULTIDISTRICT LITIGATION: HANDLING CASES BEFORE THE JUDICIAL PANEL ON MULTIDISTRICT LITIGATION 2 (Little, Brown and Company 1986, Supp. 1996). For a thorough discussion of state-court counterparts to the federal statute, see MARK HERRMANN ET AL., STATEWIDE COORDINATED PROCEEDINGS: STATE COURT ANALOGUES TO THE FEDERAL MDL PROCESS (Thomson West, 2d ed. 2004). 174. 28 U.S.C. § 1407(a) (2004). 175. Id. 176. HERRMANN, supra note 173, at 1.

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mass tort proceedings.177 In situations where within a single state many claims are pending within various state courts, a statewide process similar to the federal MDL process is needed.178 Many lawyers are at least aware of the federal MDL process; however, fewer are familiar with similar state court processes.179

Two examples of where state courts have implemented innovative programs to help manage state court caseloads and case disposition timeliness are programs in Pennsylvania and California. Pennsylvania Rule of Civil Procedure 213 defines the requirements for consolidation of claims in Pennsylvania state courts.180 In Pennsylvania, claims that are frequently coordinated and consolidated include automobile accident cases (particularly when they involve an insurance coverage dispute) and mass tort cases involving “manufacture and use of bone screws and breast implants.”181

Management of other mass-tort claims often occurs in the Philadelphia Court of Common Pleas, where the “Complex Litigation Center” was established to specifically manage mass tort claims.182 The court was the first in the nation to establish an exclusive court to manage complex, mass tort claims.183 The streamlined procedures of the Complex Litigation Center were designed to encourage communication among the parties and the court, and to eliminate redundant efforts.184 The program created standardized procedures for managing claims involving asbestos, lead paint, carpal tunnel syndrome, Norplant, latex gloves, diet drugs, and Tylenol.185

In its effort to streamline mass-tort case management proceedings, the Complex Litigation Center set up standardized pleadings for mass torts.186 In addition, it centralized motion practice for mass torts.187 Discovery proceedings are also

177. Id. 178. Id. 179. Id. 180. PA. R. CIV. P. 213.

181. HERMANN, supra note 173, at 420. 182. Mary McGovern, Complex Litigation Center Programs, Complex Litigation Center, available at http://courts.phila.gov/pdf/civil2001/clc.pdf (last visited Feb. 11, 2005). 183. Id. 184. HERRMANN, supra note 173, at 422. 185. Id. at 421. 186. Id. at 422. 187. Id. at 423.

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standardized, and a discovery schedule is synchronized with its trial calendar.188 The Pennsylvania Complex Litigation Center has been viewed as a success, as it “succeeded in dramatically reducing the asbestos docket and quickening the pace of other mass-tort proceedings.”189

In California, the civil practice code outlines rules for aggregation of multi-county claims.190 California’s program is one of the most organized programs in the country.191 After receiving a petition for case coordination or consolidation, a judicial council appoints a judge to determine whether to allow claim aggregation.192 California often permits case consolidation, and when approved for consolidation, the judicial council will then appoint a judge to hear the consolidated case.193 California’s coordination program is essentially identical to the federal multidistrict litigation program except that California permits complex case coordination for both pretrial and trial purposes.194 Other states, including Illinois, New York, and Texas, have also adopted programs that allow for case coordination or consolidation at the state court level.195

When courts consolidate cases, the result may be a complex case with the possibility of overwhelming the judge and/or jury.196 In 1997, California set up the Judicial Council on Litigation Task Force “to find ways [for state] trial courts [to] manage complex civil litigation more efficiently and effectively.”197 The California Task Force noted that complex litigation involves claims requiring exceptional management so the courts are not excessively burdened.198 The California Judicial Council approved Task Force recommendations, including “[d]istributing the Deskbook on the

188. Id. at 422-23. 189. Id. at 421. 190. CAL. CIV. PROC. CODE § 404 (West 1974); Paul D. Rheingold, Prospects for Managing Mass Tort Litigation in the State Courts, 31 SETON HALL L. REV. 910, 911 (2001). 191. Rheingold, supra note 190. 192. Id.; HERRMANN, supra note 173, at 115. 193. Rheingold, supra note 190, at 911-12; HERRMANN, supra note 173, at 119. 194. HERRMANN, supra note 173, at 109. 195. Id. at 247, 379, 493. 196. Hugh H. Bownes, Should Trial by Jury be Eliminated in Complex Cases?, 1 RISK: ISSUES IN HEALTH & SAFETY 75, 79-80 (1990). 197. Complex Civil Litigation Task Force, Fact Sheet (Sept. 2004), available at http: www.courtinfo.ca.gov/reference/documents/comlit.pdf. 198. Id.

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Management of Complex Litigation to all judges.”199 In addition, six trial courts participated in the “Complex Civil Litigation Pilot Program” with the goal being to give trial court judges tools to manage complex litigation cases more efficiently and effectively.200

The complex litigation programs in Pennsylvania and California are the exceptions rather than the rule. State courts continue to encounter challenges when faced with in-state complex litigation matters and/or class action lawsuits. Some practitioners are calling for a solution to manage class action lawsuits, urging for expansion of federal jurisdiction so that more class action claims can be heard in federal courts.201 Another way state courts can manage judicial caseloads is through use of special masters.202

Special masters bring much-needed expertise and specialization to cases involving highly specialized issues. In addition, by allowing special masters to manage pretrial discovery matters, judges are able to focus on additional pending cases. In essence, by referring case management matters to special masters, in a complex litigation matter or mass-tort case, the judge and special master are able to work on parallel tracks and move a case along more quickly. The net result that courts realize when using special masters is two-fold: improved efficiency in resolving cases, and increased number of cases resolved.

D. State, Federal Coordination

Special masters have potential value in coordinating parallel state and federal proceedings.203 One instance where a special master was appointed to manage the state-federal coordination was in the silicone gel breast implant litigation.204 Either assigning a

199. Id. 200. Id. 201. Milliken, supra note 158, at 20-21. 202. Thomas Greene & Patricia A. Conners, State Antitrust Enforcement, 1427 PRACTICING L. INST. CORP. 809, 836 (May 2004). Under Rule 53 of the Federal Rules of Civil Procedure, a court may appoint a special master to perform duties consented to by the parties, make or recommend findings of fact, and address pretrial and post-trial matters that the judiciary cannot resolve efficiently. FED. R. CIV. P. 53. 203. See MANUAL, supra note 10, § 20.31 (noting that complex litigation often involves cases brought in both federal and state court). See generally William W. Schwarzer et al., Judicial Federalism in Action: Coordination of Litigation in State and Federal Courts, 78 VA. L. REV. 1689 (1992) (discussing approaches to complex case coordination among state and federal courts). 204. See MANUAL, supra note 10, § 20.311 (citing Francis E. McGovern,

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special master in state court proceedings to coordinate with federal court proceedings, or cross-appointing a special master (appointing as a state court master the same individual assigned in federal court) may offer tremendous rewards in overall case management.

V. THE FUTURE

Special masters provide benefits to courts, whether federal or state, in terms of the specialized expertise they offer, and the ability to ease burdens on the judiciary from extensive discovery processes and case management tasks. State court rules permit the use of special masters. In turn, state courts should take advantage of the discretion inherent in the rules to appoint a special master to manage or oversee difficult and complex matters.

In appointing a special master, the state court, following the practice of federal courts, should provide a written order of reference. The written order of reference should detail the circumstances justifying the appointment of the special master.205 In addition, the reference to the special master should outline the procedures for the special master to follow, and identify reporting requirements for the special master, while also providing a provision regarding the special master’s fees.206

State courts have an opportunity to streamline case management and resolve cases more quickly by utilizing special masters. In addition, in the interest of justice, special masters offer much-needed expertise in the areas of accounting, finance, science, and technology, which in certain cases, can help ensure a fair result. Increased use of special masters by state courts will benefit all involved with litigation—the parties, the attorneys, and the courts.

Rethinking Cooperation Among Judges in Mass Tort Litigation, 44 UCLA L. REV. 1851, 1870 (1997)). 205. See MANUAL, supra note 10, § 40.28 (providing a sample order for referral of privilege claims to a special master). 206. Id.

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SPECIAL MASTER AUTHORITIES APPENDIX

State Court Authorities Governing Special Masters, Referees, Commissioners, and Similar Judicial Adjuncts

And Comparison State Rules to Federal Rule of Civil Procedure

Rule 53

State Authorities and Comparison to FED. R.

CIV. P. Rule 53 Alabama ALA. R. CIV. P. WITH DIST. CT.

MODIFICATIONS 53 Adopts pre-2003 amended version of the federal rule but state rule does not apply to state district courts.

Alaska ALASKA R. CIV. P. 53 ALASKA CT. R., CHILD IN NEED OF AID 4 ALASKA CT. R., DELINQUENCY 4

Arizona 16 PART 1, A.R.S. RULES OF CIV. PROC., RULE 53 ARIZ. R. SUPER. CT. 96(e) (granting presiding judge in Superior Court power to appoint Court Commissioners with agreement of each party) Adopts pre-2003 amended version of the federal rule.

Arkansas ARK. R. CIV. P. 53 Modeled after pre-2003 amended version of the federal rule but limited to non-jury actions.

California CAL. CIV. PROC. CODE §§ 638 - 639 (West 2004) Requires agreement of the parties.

Colorado COLO. CT. C.P.R. 53 Adopts pre-2003 amended version of federal rule.

Connecticut CONN. R. SUPER. CT. PROC. FAMILY MATTERS § 25-53 Limited scope – only applies to family

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law matters. Pilot program established for civil/family discovery masters and civil matter settlement conferences scheduled to end 12/31/2004.

Delaware DEL. S. CT. R. 43(b)(v) DEL. CT. CH. R. 135 – 47 DEL. FAM. CT. C.P.R. 53 DEL. SUPER. CT. CRIM. R. 5 Limited to hearing issues of fact.

District of Columbia D.C. SUPER. CT. R. CIV. P. 53 D.C. SUPER. CT. R. DOM. REL. 53 D.C. SUPER. CT. R. CRIM. P. 117 Adopts pre-2003 amended version of the federal rule.

Florida FLA. STAT. ANN. R.C.P. RULE 1.490 (West 2004 & Supp. 2005) Requires parties’ consent.

Georgia GA. CODE ANN. §§ 9-7-1 to -6 (1982 & Supp. 2004)

Hawaii HAW. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Idaho IDAHO R. CIV. P. 53 IDAHO CRIM. R. 2.2 Adopts pre-2003 amended version of federal rule.

Illinois Illinois does not use fee officials.207 Indiana IND. R. TRIAL P. 53

Adopts pre-2003 amended version of federal rule.

Iowa IOWA R. CIV. P. 1.935 Adopts pre-2003 amended version of federal rule.

Kansas KAN. STAT. ANN. § 60-253 (1994 & Supp. 2002) When parties consent, any issue can be referred to a special master. Contains language where without the parties

207. Mullaney, Wells & Co. v. Savage, 282 N.E.2d 536, 538 (Ill. App. Ct. 1972).

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consent, the court can only refer a case to a master when justice will be measurably advanced, or to cases that will be tried to a jury when they involve examination of complex or voluminous accounts.

Kentucky KY. R. CIV. P. 53.01 When appointed to matters other than judicial sales, settlement, receivership, and bills of discovery assets of judgment debtors, appointment requires that the matter involve complex calculations, multiplicity of claims, or other exceptional circumstances.

Louisiana LA. REV. STAT. ANN. § 13:4165 (West Supp. 2004) Court can appoint in any civil action with parties consent if there is a complicated issue or when exceptional circumstances exist.

Maine ME. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Maryland MD. CIR. CT. R. CIV. P. 2-541 Limited to non-jury matters.

Massachusetts MASS. R. CIV. P. 53 MASS. R. CRIM. P. 47 Adopts pre-2003 amended version of federal rule but also requires assent of all parties prior to special master appointment.

Michigan MICH. CT. RULES PRAC. R. 3.913 Applies to probate and juvenile court. Can conduct preliminary inquiries and can preside at hearings other than a jury trial or preliminary examination.

Minnesota MINN. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Mississippi MISS. R. CIV. P. 53

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Can refer any issue to a special master with the written consent of the parties, otherwise appointment requires an exceptional condition.

Missouri MO. R. CIV. P. 68.01 Adopts pre-2003 amended version of federal rule.

Montana MONT. CODE ANN. § 25-20-R. 53 (2003) Adopts pre-2003 amended version of federal rule.

Nebraska NEB. REV. STAT. §§ 25-1129 to -1137 (2004) Appointment requires written consent of the parties.

Nevada NEV. R. CIV. P. 53 NEV. 1ST JUD. DIST. CT. R. 5 Adopts pre-2003 amended version of federal rule.

New Hampshire N.H. R. SUPER. CT. 85-A Appointment requires written consent of the parties.

New Jersey N.J. CONST. art. 11, § 4, ¶ 7 N.J. R. CIV. PRAC. 4:41 Appointment requires parties’ consent.

New Mexico N.M. R. CIV. P. 1-053 Adopts pre-2003 amended version of federal rule.

New York N.Y. UNIF. TRIAL CT. R. § 202.14 Chief Administrator of courts has power of appointment.

North Carolina N.C. GEN. STAT. § 1A-1, R. 53 (2003) Modeled after pre-2003 amended version of federal rule. Certain actions require parties’ consent prior to appointment.

North Dakota N.D. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Ohio OHIO REV. CODE ANN. CIV. R. 53 OHIO REV. CODE ANN. CRIM. R. 19

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OHIO REV. CODE ANN. JUV. R. 40 Modeled after pre-2003 amended version of federal rule. Does include pre-trial and post-trial matters, or matters where the parties consent.

Oklahoma OKLA. STAT. ANN. tit. 12, §§ 612-619 (West 2000) Can appoint to any civil action with the parties’ written consent.

Oregon OR. R. CIV. P. 65 Appointment requires written consent of the parties; without consent of the parties, appointment requires an exceptional condition.

Pennsylvania 42 PA. CONS. STAT. ANN. §§ 1558, 1920.51 (West 2002) Court can appoint at any time after the preliminary conference and master can hear any issue or the entire matter.

Rhode Island R.I. R. CIV. P. 53 R.I. R. PROC. DOM. REL. 53 Adopts pre-2003 amended version of federal rule but also provides greater latitude in appointing a special master; special master may be appointed to any issue where the parties agree.

South Carolina S.C. R. CIV. P. 53 Allows appointment when the parties consent.

South Dakota S.D. CODIFIED LAWS § 15-6-53 (West 2004) Adopts pre-2003 amended version of federal rule.

Tennessee TENN. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Texas TEX. R. CIV. P. 171 Adopts pre-2003 amended version of federal rule but requires parties’ consent to appointment of a master. Other modifications include that the

31



16JOKELAHERR 3/18/2005 2:31:27 PM


case must be an “exceptional one” and there must be “good cause” for appointment of a master.

Utah UTAH R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

Vermont VT. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule with minor modifications. State rule is narrower because for actions to be tried by a jury, appointment is only made when the action requires investigation of accounts or examination of vouchers.

Virginia VA. S. CT. R. 2:18, 3A:1 A court decree refers a matter to a “commissioner in chancery.”

Washington WASH. SUPER. CT. CIV. R. 53.3 Adopts rule that is broader than the pre-2003 amended version of federal rule. State rule allows appointment for “good cause” and allows appointment of special master to discovery matters.

West Virginia W. VA. R. CIV. P. 53 Wisconsin WIS. STAT. § 805.06 (1994)

Adopts pre-2003 amended version of federal rule with minor modifications, i.e. “referee” used in place of “special master.”

Wyoming WYO. R. CIV. P. 53 Adopts pre-2003 amended version of federal rule.

32



BY RON KILGARD

The use of discovery masters in civil cases is a practice, likemediation, that has grown gradually, not because of anytop-down directive from the judiciary or the legislature,but because of the necessities of actual cases. Like media-tion 10 years ago, discovery masters are largely unregulat-ed by rule or statute: The current rule on masters, Rule53, has nothing to say about discovery masters. And dis-covery masters are the subject of few cases. This articletakes a look at these neglected creatures.

The Law on Discovery Masters

Old Rule 53 Court-appointed masters have long been the subject ofFederal Rule of Civil Procedure 53 and its Arizona coun-terpart. Until it was recently amended, the heart of thefederal rule, subsection (b), was an admonition againstusing masters in the first place: “Reference to a mastershall be the exception and not the rule.”1 The balance ofthe rule deals in some detail with the compensation andpowers of the master, the nature of the proceedings infront of the master (witnesses, subpoenas, etc.), and thecontents, filing and format of the master’s “report.”

The Arizona rule, which has not yet been amended,differs only in details from the old federal rule. In fact, the

DISCOVERYDISCOVERYmastersWhen They

Help—and When They Don’t

30 A R I Z O N A AT T O R N E Y A P R I L 2 0 0 4

32 A R I Z O N A AT T O R N E Y A P R I L 2 0 0 4 W W W. A Z B A R . O R G

Arizona rule is even more restrictive of themaster’s powers than the federal rule was,for it prohibits reference in any cases to betried to a jury.

There is one glaring omission. There isnothing in the old federal rule, and there isnothing in the current Arizona rule, aboutdiscovery or pretrial procedures generally.This is not surprising given the fact thatthe rule was originally adopted as EquityRule 59 in 1912.

Lots of thingshave changed sincePresident WoodrowWilson’s first term,among them thetechniques of mod-ern civil litigation.There really wasn’tdiscovery when therule was adopted, atleast not in thesense in which weunderstand it. Therule was designedfor traditional mas-ters—people who acted as decision makersof specifically identified substantive issues.Some authorities doubted that rule evenapplied to discovery masters.2

The federal cases on discovery mastersare few—and there are no Arizona cases.3

Generally, the courts have recognized thatthe appointment of discovery masters,though still the exception and not the rule,is quite different from appointment of thefull-fledged special master contemplatedby Rule 53. As one district court indicated,“Courts have distinguished between dis-positive matters and discovery or othernon-dispositive motions or issues, requir-ing a much greater showing to warrantreferral of dispositive matters than for dis-covery matters.”4

In appropriate cases, the courts recog-nize that discovery masters are not onlypermissible, but invaluable.5 In many cases,especially those decided before magistrateswere widely used, it is hard to see what thecourt could have done except appoint amaster. On the other hand, courts do nothesitate to reverse an appointment when

the parties oppose the master and there isno apparent need for him or her.6 But onthe nuts and bolts of the practice, the casesare essentially silent.

New Rule 53 The obvious disconnect between the ruleand the practice led the JudicialConference to propose a completely newrule, which became effective Dec. 1, 2003.

The new ruledeals with dis-covery mastersand traditionalad judicator ymasters. Thenew rule keepst r a d i t i o n a lmasters on ashort leash7 butrecognizes thevery differentconcerns bear-ing on discov-ery masters.Appointment

of discovery masters is available, even overthe parties’ objection, whenever there are“matters that cannot be addressed effec-tively and in a timely fashion by an avail-able district judge or magistrate judge.”8

The new rule addresses several issues con-cerning discovery masters that wereaddressed neither in the old rule nor thecase law:• Consultation With the Judge. Should

the discovery master confer privatelywith the judge to maximize the effi-ciency of the engagement, or shouldhe decide things entirely on his own toprovide a clear record of authority andreview? The rule makers recognizedthat different cases will require differ-ent relationships with the trial judge.The new rule requires only that theappointment order spell out clearly“the circumstances—if any—in whichthe master may communicate ex partewith the court.”9

• Appearing Before the Judge. May thespecial master appear before the judgeas a lawyer during the course of his

DiscoveryMasters

In appropriate cases, courts recognize that discovery masters are not only permissible,

but invaluable.

33A P R I L 2 0 0 4 A R I Z O N A AT T O R N E YW W W. A Z B A R . O R G

engagement? An early draft of the rulesimply forbade the practice. As finallyadopted the rule is silent on the mat-ter, with the Notes suggesting that thejudge address the issue at the time ofappointment.10

• Impartiality. The impartiality require-ments applicable to federal judgesapply awkwardly to lawyers, who, afterall, have ongoing practices. The newrule provides that the master must bequalified under the relevant federalstatute (28 U.S.C. § 455), but, recog-nizing that this may prove difficult, theparties may consent to the appoint-ment.11 The central point is that allpotential conflicts be disclosed andagreed to.12

• Orders. The new rule recognizes thatdiscovery masters typically do not issuelengthy “reports,” the mainstay of theold rule, but make decisions on specif-ic discovery issues. The new rule pro-vides that these decisions are to befiled, that the court will review themon a timetable set by the court, and soon.13

• Standard of Review. The rule alsoaddresses the vexing topic of the stan-dard of review. The law on this subjectis scarce, so it is helpful to have itspelled out in the rule. Proceduralmatters are reviewed only for an abuseof discretion.14 Legal matters are, ofcourse, reviewed de novo.15 Factualfindings are also reviewed de novo,unless the parties consent in theappointment order to a different stan-dard.16

• Other Matters. The new rule address-es in detail a host of other matters, butit is noteworthy how the rule is almostentirely a codification of existing prac-tice, at least the better practice, andnot a template for a new practice. Thenew rule, if adopted in Arizona, willstreamline the use of discovery mastersin superior court and make us all morecomfortable with what we’re doing,but it will not significantly alter thecurrent practice.

34 A R I Z O N A AT T O R N E Y A P R I L 2 0 0 4 W W W. A Z B A R . O R G

the areas of dispute. Item by item, disputesare cleared away. And the mere fact of hav-ing to discuss these issues in person withthe master present, and not in angry faxesand e-mails written late at night, has a tam-ing effect on the lawyers.

3. Privilege Disputes

Genuine privilege disputes over large num-bers of documents throw a wrench into thelitigation system. The document-by-docu-ment review necessary to resolve them is allbut impossible for a superior court judge,given the obligations of her docket. Caseslike these are naturals for discovery masters.As one court found, “A special master isbest situated to conduct the detailed, closeanalysis necessary to ferret out which docu-ments are privileged.”19

4. The Big Case

Size alone does not necessarily mean a caseis suitable for a discovery master, butnumerous lawyers and witnesses bringtheir own problems. Especially if the par-ties are trying to squeeze into a court-ordered schedule, simply scheduling depo-sitions becomes almost impossible. A dis-covery master who meets with the lawyerson a fixed schedule reviewing all of thedepositions, hearing all the excuses why awitness couldn’t make it last month,becoming familiar with the lawyers’ variousschedules and airport preferences, and soon, can keep the case on track.

Cases Unsuitable for Discovery Masters I have found two circumstances in whichappointment of a discovery master is coun-terproductive.

1. The Contentious Cases Revisited

Let’s return to the contentious case.Although, as I have said, a master can do aworld of good in such cases, one must bewary that the discovery master doesn’tsimply become a forum for more disputes.

In a typical lawsuit in superior court,the system can only handle so many dis-covery disputes. Lawyers who insist oncalling the court in the middle of deposi-tions will gradually find their resolve worn

down. Motions on minor issues that willnot be heard in court for two months, bywhich time they may be moot, eventuallywill not be filed.

However, when a discovery master isreadily available and can be reached essen-tially any time day or night (the parties arepaying for him, after all), one can end upwith a case in which every deposition leadsto protracted phone calls with the discov-ery master, every minor document disputeresults in a motion and every routinesquabble about an expert’s fee gives birthto a hearing.

In such cases, the master must developprocedures to prevent discovery fromswamping the case. But in many suchcases, the master should not have beenappointed in the first place.

2. The Routine Case

A second case in which the master can domore harm than good is the case that justdoesn’t need one. Seeing the parties infre-quently, the master will have little morefamiliarity with the case than the trialjudge, and often even less, because he willnot have handled the motions on the mer-its. The decisions on the few matters thatcome before him will often be appealed tothe trial judge, adding nothing to theprocess but delay and expense. Like everyother tool of litigation, from fountain pensto handheld computers, masters work bestif they are used, and they should only beused if they are needed.

Selecting the MasterBecause the pool of masters is simplylawyers and former judges, the lawyers sel-dom have any trouble in finding someonewilling to serve. More difficult is findingsomeone who is right for the case. In thisrespect, selecting a master is no differentfrom selecting an arbitrator or a mediator.

Obviously, if the parties can agree onsomeone, the master is far more likely tobe effective. And, of course, whoever isselected should have common sense and agood knowledge of the law on discovery,privilege, and so forth. It won’t do much

DiscoveryMasters

Discovery Masters in Practice

The issues addressed and the concernsraised by the cases, and the new rule, con-firm my own experience as a discoverymaster, which has been entirely in statecourt. It strikes me that there are certainfactors that tend to indicate that appoint-ment of a discovery master is a good idea,and a couple of others that indicate theopposite. Let’s start with some of the cir-cumstances in which appointment of a dis-covery master is useful, both to the courtand to the parties.

Cases Suitable for Discovery Masters 1. The Parties Want One

When the parties consent to a discoverymaster, they are pretty much stuck withhim.17 They are also far more likely to becontent with him. If the parties consent, itusually means that they are concerned thatthe institutional limitations of superiorcourt, the caseload, the pre-emptivedemands of the criminal trial calendar, andthe lack of legal support staff for judges willhave an adverse effect on their client. It mayseem odd that both parties could concludethis, but they often do. Even adversariessometimes have common ground.

2. The Contentious Case

Highly contentious lawsuits are hard forthe superior court to manage.18 The wearyjudge, forced to decide disputes based onincomplete information at unpleasant hear-ings, will be tempted to split the difference.Matters will get worse as each side nursesreal and imagined grievances.

A discovery master can be a useful toolin these cases. The lawyers will not stophating each other because of the discoverymaster, but they will gradually stop tellingthe same story over and over again.Reviewing the deposition schedule monthafter month, or in some cases, week afterweek, gives the discovery master a familiar-ity with the witnesses, the practices on feesand travel, what documents have been pro-duced, and so on, that gradually do narrow

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good to have a master if the judge finds itnecessary to reverse every third decision,or if the parties come to lack confidence inhis abilities. But in an appropriate case, acompetent discovery master can benefitthe parties and court enormously.

Ron Kilgard is an attorney with KellerRohrback, PLC, in Phoenix.

1.“A reference to a master shall be the exceptionand not the rule. In actions to be tried by ajury, a reference shall be made only when theissues are complicated; in actions to be triedwithout a jury, save in matters of account andof difficult computation of damages, a refer-ence shall be made only upon a showing thatsome exceptional circumstance requires it.”FED. R. CIV. P. 53(b) (before Dec. 1, 2003).

2. See Simpson v. Canales, 806 S.W.2d 802, 807(Tex. 1991) (good discussion of the historicalbackground). And even if the rule doesn’tapply, courts have the inherent power toappoint masters.

3. On the other hand, pursuant to statute, dis-covery masters are widely used in Californiastate courts, and there is a substantial case lawon them. E.g., Lu v. Superior Court, 55 Cal.App. 4th (Ct. App. 1997); San Diego UnifiedPort Auth. v. Barnhart, 116 Cal. Rptr. 2d 65(App. 2002); Collins v. Kanoff, 2003 WL145631 (App. 2003).

4. In re Sunrise Securities Litigation, 124 F.R.D.99 (E.D. Pa. 1989).

5.Id. (discovery master appropriate because ofextensive disputes on privileged documents);Mercer v. Gerry Baby Prods. Co., 160 F.R.D.576, 577 (S.D. Iowa 1995) (discovery masterappropriate because “the lawyers are out ofcontrol”).

6.See Simpson v. Canales, 806 S.W.2d 802 (Tex.1991).

7.See Chartone Inc. v. Bernini, 418 Ariz. Adv.Rep. 60, 66 n.3 (Ct. App. 2004) (discussingnew federal rule).

8.FED. R. CIV. P. 53(a).9.FED. R. CIV. P. 53(b)(2)(B).

10.Committee Note, Subdivisions (a)(2) and (3),FED. R. CIV. P.

11.FED. R. CIV. P. 53(b)(3).12.Committee Note, Subdivisions (a)(2) and (3),

FED. R. CIV. P.13.FED. R. CIV. P. 53(e) & (g).14.FED. R. CIV. P. 53(g)(5).15.FED. R. CIV. P. 53(g)(4).16.FED. R. CIV. P. 53(g)(3).17.Simpson, 806 S.W.2d at 811.18.Mercer, 160 F.R.D. at 576.19.Sunrise Securities Litigation, 124 F.R.D. at

100.

endnotes

1 of 1 DOCUMENT

California Deposition and Discovery Practice

Copyright 2011, Matthew Bender & Company, Inc., a member of the LexisNexisGroup.

DIVISION III METHODS OF CIVIL DISCOVERYPART A In General

CHAPTER 41 Regulation of Discovery MethodsPART C. Reference and Preliminary Trial Conferences

1-41 California Deposition and Discovery Practice § 41.20

§ 41.20 Court Appointment of Referee

[1] Appointment and Challenge

A court must appoint as referee or referees the person or persons, not exceedingthree, agreed on by the parties. n1 When the parties do not agree on theselection of a referee or referees, a court may appoint a referee, in accordancewith Code of Civil Procedure Section 640(b), when, in any pending action, itdetermines that it is necessary to appoint a referee to hear and determine anyand all discovery motions and disputes relevant to discovery in the action. n2The appointment may be made on the written motion of any party or on the court'sown motion. n3 The referee is authorized to report his or her findings to thejudge and make a recommendation on the findings. n4 Such an appointment may beappropriate, for example, in cases of great magnitude or complexity. n5

When a referee is appointed under Code of Civil Procedure Section 639(5)(a), theorder must indicate whether the referee is being appointed for all discoverypurposes in the action. n6

If either party objects to the referee appointed by the trial court, that partymay promptly file a peremptory challenge pursuant to Code of Civil ProcedureSection 170.6. n7

If a discovery referee has been appointed for all discovery purposes, the motionto disqualify an appointed referee under Code of Civil Procedure Section 170.6must be made to the court by a party either within ten days after notice of theappointment, or if the party has not yet appeared in the action, within ten daysafter the appearance. n8 If the discovery referee has been assigned only forlimited discovery purposes and the referee assigned is known at least ten daysbefore the date set for hearing, the motion to disqualify an appointed refereeunder Code of Civil Procedure Section 170.6 must be made at least five daysbefore the date set for hearing. n9

Page 1

[2] Trial Court's Acceptance of Referee's Report

A trial court may accept a discovery referee's report without holding a hearing.Although such a report is advisory rather than determinative and the trial courtmust independently consider the referee's findings before acting on his or herrecommendations, the trial court is not required to hold a hearing as a matterof law. If the court's order demonstrates a considered and careful review, notonly of the referee's report, but also of the transcript of the proceedingsbefore the referee, and of the objections, replies, and other papers filed afterthe referee's report was submitted, the court fulfills its judicialresponsibilities. n10

[3] Allocating Costs of Reference

The prevailing party may not recover the costs of a discovery referee as amatter of right. n11 The trial court may order the party who requests thereferee to pay the referee's fees. n12 However, it is the trial court'sresponsibility to form a fair means of discovery dispute resolution thatconsiders the financial status of the parties. If the appointment of a discoveryreferee is inappropriate because of the costs that would be incurred by theparties, the trial court should consider alternatives, including a pro bonoreferee, a retired judge of the superior court sitting by assignment, orretention of the matter by the trial court. n13 The court should also considerretaining the discovery dispute, particularly when the parties object anduncomplicated matters are involved. Such action is in keeping with the goals ofindependent calendaring. n14

It is an abuse of discretion for a trial court to order discovery disputes to beheard by a private referee, with the parties sharing the costs equally, withoutconsidering the economic impact on the parties. n15 Moreover, the court may notappoint a referee at a cost to the parties unless the court finds either that noparty has established an economic inability to pay a pro rata share of thereferee's fee, or that one or more parties has established an economic inabilityto pay a pro rata share of the referee's fees and that another party has agreedvoluntarily to pay that additional share of the referee's fee. n16 If the issueof economic hardship is raised by a party before the referee commences his orher work, the referring court must determine a fair and reasonable apportionmentof the reference costs before issuing its order. n17 Unless there is somethingto make the court question the accuracy a lawyer's unsworn representationconcerning a party's financial hardship or of a litigant's sworn declaration offinancial hardship, counsel's representation or a litigant's declaration shouldbe considered sufficient, and no more can be required. n18 "Fair and reasonable"apportionment does not mean imposing the entire cost of reference on anobjecting financially-able party because the other party is indigent. n19

In determining whether a party has established an inability to pay the referee'sfees under Code of Civil Procedure Section 639(d)(6)(A) (requiring that thecourt make that determination), the court must consider only the ability of theparty, not the party's counsel, to pay these fees. If a party is proceeding informa pauperis, the party must be deemed by the court to have an economicinability to pay the referee's fees. However, a determination of economicinability to pay the fees is not limited to parties that proceed in formapauperis. For those parties who are not proceeding in forma pauperis, the court,in determining whether a party has established an inability to pay the fees,must consider, among other things, the estimated cost of the referral and the

Page 21-41 California Deposition and Discovery Practice § 41.20

impact of the proposed fees on the party's ability to proceed with thelitigation. n20

In considering a litigant's indigence in connection with a possible reference,the court may accept counsel's representations, without requiring declarationsor an application to proceed in forma pauperis, unless the court has reason tosuspect the representations are inaccurate. n21

The allocation of the referee's fees must be made by the court and not by thereferee. n22

One court has held that a trial court does not have the authority to order anattorney to pay his or her client's share of discovery referee's fees under Codeof Civil Procedure Section 128. n23 However, the appellate court emphasized thenarrow nature of its holding, noting that the trial court, in this case, did notjustify its order that counsel pay the fees of the discovery referee on thebasis of Code of Civil Procedure Sections 2023.010 et seq. and 2031.010 et seq.n24 It may well be that, in a proper case, the burden of such fees could beplaced on an erring attorney under the discovery statute. n25

Legal Topics:

For related research and practice materials, see the following legal topics:Civil ProcedureJudicial OfficersRefereesAppointmentsCivil ProcedureJudicialOfficersRefereesRemovalsCivil ProcedurePretrial MattersConferencesPretrialConferencesCivil ProcedurePretrial MattersConferencesPretrial Orders

FOOTNOTES:(n1)Footnote 1. Code Civ. Proc. § 640(a).

(n2)Footnote 2. Code Civ. Proc. § 639(a)(5).

(n3)Footnote 3. Code Civ. Proc. § 639(a).

(n4)Footnote 4. Code Civ. Proc. § 639(a)(5). See Sauer v. Superior Court(1987) 195 Cal. App. 3d 213, 225-226, 240 Cal. Rptr. 489 (referee's orderimposing issue sanction on plaintiff was advisory and not binding on court; dueprocess not denied when judge independently reviewed referee's order beforesigning it, and reviewed it again at hearing on plaintiff's motion opposingorder).

(n5)Footnote 5. See, e.g., Lu v. Superior Court (1997) 55 Cal. App. 4th1264, 1266, 1269-1270, 64 Cal. Rptr. 2d 561 (referee was appointed beforediscovery dispute even arose).

(n6)Footnote 6. Code Civ. Proc. § 639(c); see Code Civ. Proc. § 639(d)(required contents of written order).

(n7)Footnote 7. Autoland, Inc. v. Superior Court (1988) 205 Cal. App. 3d857, 859-862, 252 Cal. Rptr. 662 , superseded on other grounds by statute (CodeCiv. Proc. § 641 grounds for disqualification do not constitute exclusive basesfor disqualifying referee).

(n8)Footnote 8. Code Civ. Proc. § 639(b)(A).

(n9)Footnote 9. Code Civ. Proc. § 639(b)(B).


(n10)Footnote 10. Marathon Nat. Bank v. Superior Court (1993) 19 Cal. App.4th 1256, 1260-1261, 24 Cal. Rptr. 2d 40 ; see Rockwell Internat. Corp. v.Superior Court (1994) 26 Cal. App. 4th 1255, 1269-1270, 32 Cal. Rptr. 2d 153(trial court abdicated its judicial responsibility by entering order onreferee's report without proper review).

(n11)Footnote 11. Baker-Hoey v. Lockheed Martin Corp. (2003) 111 Cal. App.4th 592, 594, 3 Cal. Rptr. 3d 593 (rejecting defendant's argument that it wasentitled to recover costs of discovery referee as expert witness fees under CodeCiv. Proc. § 1033.5(a)(8)).

(n12)Footnote 12. Marathon Nat. Bank v. Superior Court (1993) 19 Cal. App.4th 1256, 1261-1262, 24 Cal. Rptr. 2d 40 .

(n13)Footnote 13. Taggares v. Superior Court (1998) 62 Cal. App. 4th 94,101, 72 Cal. Rptr. 2d 387 (court must consider effect of reference on party of"modest means" as well as on party who is truly indigent); DeBlase v. SuperiorCourt (1996) 41 Cal. App. 4th 1279, 1283-1285, 49 Cal. Rptr. 2d 229 , (trialcourt erred in appointing referee where plaintiff claimed indigence and motiondid not raise complex or time-consuming issues). Solorzano v. Superior Court(1993) 18 Cal. App. 4th 603, 616, 22 Cal. Rptr. 2d 401 (abuse of discretion toorder indigent plaintiffs to pay half of referee's fee).

(n14)Footnote 14. Taggares v. Superior Court (1998) 62 Cal. App. 4th 94,104, 72 Cal. Rptr. 2d 387 (emphasizing use of word "necessary" in Code Civ.Proc. § 639(e)) (now see Code Civ. Proc. § 639(a)(5), amended withoutsubstantive change, 2000 Stats., Ch. 644, § 2); see, e.g., Hood v. SuperiorCourt (1999) 72 Cal. App. 4th 446, 449-450, 85 Cal. Rptr. 2d 114 (vacatingreference orders in routine tort action and directing court to deciderun-of-the-mill discovery "dispute" after both sides served a small number ofspecial interrogatories, a dispute arose, and both sides filed motions to compelfurther responses).

(n15)Footnote 15. McDonald v. Superior Court (1994) 22 Cal. App. 4th 364,368-370, 27 Cal. Rptr. 2d 310 ; see Solorzano v. Superior Court (1993) 18 Cal.App. 4th 603, 616, 22 Cal. Rptr. 2d 401 (Code Civ. Proc. § 645.1, governingpayment of referee fees, did not authorize court to appoint privatelycompensated discovery referee without considering monetary burden on litigants;trial court must find fair means to resolve discovery disputes, consideringparties' financial status).

(n16)Footnote 16. Code Civ. Proc. § 639(d)(6)(A).

(n17)Footnote 17. McDonald v. Superior Court (1994) 22 Cal. App. 4th 364,368-370, 27 Cal. Rptr. 2d 310 (plaintiff's declaration was competent evidence ofher ability to pay referee's fees).

(n18)Footnote 18. Hood v. Superior Court (1999) 72 Cal. App. 4th 446, 450,85 Cal. Rptr. 2d 114 (sworn declaration of 71-year-old lawyer representinghimself that order obligating him to pay referee's fees would be a hardship,together with sworn statement of his income and expenses, was sufficient proofof his inability to pay referee's fees).

(n19)Footnote 19. Taggares v. Superior Court (1998) 62 Cal. App. 4th 94,104, 72 Cal. Rptr. 2d 387 .


(n20)Footnote 20. Code Civ. Proc. § 639(d)(6)(B).

(n21)Footnote 21. DeBlase v. Superior Court (1996) 41 Cal. App. 4th 1279,1283-84, 49 Cal. Rptr. 2d 229 . See also Lu v. Superior Court (1997) 55 Cal.App. 4th 1264, 1269-1270, 64 Cal. Rptr. 2d 561 (court noted that party made noshowing of financial hardship).

(n22)Footnote 22. DeBlase v. Superior Court (1996) 41 Cal. App. 4th 1279,1286, 49 Cal. Rptr. 2d 229 (court should make a provisional fee allocationorder, subject to readjustment after referee returns report and recommendation);McDonald v. Superior Court (1994) 22 Cal. App. 4th 364, 370, 27 Cal. Rptr. 2d310 .

(n23)Footnote 23. Andrews v. Superior Court (2000) 82 Cal. App. 4th 779,782, 98 Cal. Rptr. 2d 426 ; see Code Civ. Proc. § 128(a)(4), (5) ("(a) Everycourt shall have the power to do all of the following: ... (4) To compelobedience to its judgments, orders, and process, and to the orders of a judgeout of court, in an action or proceeding pending therein ... (5) To control infurtherance of justice, the conduct of its ministerial officers, and of allother persons in any manner connected with a judicial proceeding before it, inevery matter pertaining thereto.").

(n24)Footnote 24. Andrews v. Superior Court (2000) 82 Cal. App. 4th 779,782, 98 Cal. Rptr. 2d 426 .

(n25)Footnote 25. See Andrews v. Superior Court (2000) 82 Cal. App. 4th779, 782-783, 98 Cal. Rptr. 2d 426 .


FOCUS - 8 of 10 DOCUMENTS

Copyright (c) 1999 Los Angeles County Bar AssociationLos Angeles Lawyer

May, 2000

23 Los Angeles Lawyer 16

LENGTH: 6333 words

DEPARTMENT: PRACTICE TIPS: STRATEGIES FOR THE EFFECTIVE USE OF DISCOVERYREFEREES

By Michael J. White

Michael J. White practices law at Daar & Newman, P.C., in Los Angeles. He ispresident of the Los Angeles Bureau of Municipal Research, Inc. and a member ofthe adjunct faculty of the University of Southern California School of Policy,Planning and Development.

TEXT:

[*16] The discovery reference process requires nimble counsel to balance costand risk

Discovery references are a common part of the litigation landscape inCalifornia, but they are increasingly controversial. The main sources ofcontention are the amount and allocation of referees' fees, the potential forbias on the part of referees, and the claimed overuse of discovery references.n1 For practicing litigators approaching this pretrial minefield, the mostcompelling task is to ensure the most effective use of discovery referees onbehalf of their clients.

n1 See JUDICIAL COUNCIL OF CALIFORNIA, SUBCOMMITTEE ON ALTERNATIVE DISPUTERESOLUTION AND THE JUDICIAL SYSTEM, ALTERNATIVE DISPUTE RESOLUTION IN CIVILCASES, REPORT OF THE TASK FORCE ON THE QUALITY OF JUSTICE 55-59, 87-91, 97-100(Aug. 1999) [hereinafter ADR REPORT].

Discovery references can be expensive and unpredictable, and the lawgoverning discovery references is ambiguous at best. Nevertheless, a court mostlikely will be disinclined to reverse the recommendation of the discoveryreferee it appointed, so litigators must seek to obtain an outcome from thereferee that can be presented to the court for routine confirmation.

Discovery disputes generally are raised by formal motions that are brought

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pursuant to the Discovery Act and Rule 335 of the California Rules of Court on aregular briefing schedule. n2 The authority for discovery references isexclusively statutory. n3 Code of Civil Procedure Section 639(e) expresslyprovides for court-ordered reference of discovery matters to referees "when thecourt in any pending action determines in its discretion that it is necessaryfor the court to appoint a referee to hear and determine any and all discoverymotions and disputes relevant to discovery in the action and to report findingsand make recommendations thereon." n4

n2 CODE CIV. PROC. §§ 2016 et seq.; CAL. R. OF CT. 335.

n3 Aetna Life Ins. Co. v. Superior Ct., 182 Cal. App. 3d 431, 435 (1996).

n4 CODE CIV. PROC. § 639(e).

A special reference under Code of Civil Procedure Section 639 may be orderedon motion of a party or on the court's own motion without the consent of theparties. When consent of the parties is absent, the reference is merely advisoryand the referee's findings are not binding on the superior court. n5 A Section639 referee's findings of fact, though not binding on the court, are entitled togreat weight when supported by substantial evidence. n6

n5 Aetna Life Ins. Co., 182 Cal. App. 3d at 436.

n6 In re Avena, 12 Cal. 4th 694, 710 (1996).

Section 639(e) references are very common in civil litigation. Less frequentare references under Code of Civil Procedure Section 638, which, in contrast toSection 639, provides for a binding reference by agreement of the parties todetermine the issues submitted, rather than to hear, report, and recommend. n7Section 638 referees are much like arbitrators in a binding arbitration. Thus,unlike Section 639 referees, Section 638 referees do not make recommendations tothe court, and their appointment is not subject to a detailed court order, amongother distinctions. The difference between Section 638 and Section 639references is rooted in the California Constitution. Article VI, Section 22,limits the nonconsensual delegation of judicial powers to the delegation ofsubordinate judicial duties and precludes delegation of such matters as thedetermination of questions of law. n8 A Section 639 referee, for example, cannotdetermine a motion for summary adjudication. n9

n7 CODE CIV. PROC. § 638.

n8 CAL. CONST. art. VI, § 22; Kim v. Superior Court, 64 Cal. App. 4th 256,259-61 (1998); Aetna Life Ins. Co., 182 Cal. App. 3d at 435.

n9 Jovine v. FHP. Inc., 64 Cal. App. 4th 1506, 1523-25 (1998).

Section 639's guidance on when trial courts may delegate discovery disputesto referees is unclear, however. Along with the appellate bench, the JudicialCouncil has addressed this lack of clarity in its recent "Alternative DisputeResolution in Civil Cases, Report of the Task Force on the Quality of Justice"(the ADR Report). n10 In Hood v. Superior Court and DeBlase v. Superior Court,the courts held that discovery references were unwarranted under the

Page 1223 Los Angeles Lawyer 16, *16

circumstances of those cases n11 -- but these holdings are helpful only for themost obvious cases. In Hood, for example, a general discovery reference wasordered by a trial court faced with clear and straightfor ward discoverymotions. The appellate court commented that "any judge could resolve thediscovery 'dispute' in about five minutes." n12

n10 See MacMillan v. Superior Court, 50 Cal. App. 4th 246, 253, 256-58 (1996)(expressing "serious concerns about the increasing use of discovery referees,"detailing those concerns, and inviting legislative response) and ADR REPORT,supra note 1, at 55 and nn. 217, 218, and 219 (recommending legislation to limitdiscovery references to those that are required by "exceptional circumstances ofthe particular case").

n11 Hood v. Superior Court, 72 Cal. App. 4th 446 (1999); DeBlase v. SuperiorCourt, 41 Cal. App. 4th 1279 (1996).

n12 Hood, 72 Cal. App. 4th at 449.

The opinion in Taggares v. Superior Court sets forth specific but elasticfactors that might justify a blanket discovery reference:- The need to resolve multiple issues will have an undue effect on the court'stime or resources.- Multiple motions must be heard, either at the same time or seriatim.- A significant number of documents must be reviewed. n13

n13 Taggares v. Superior Court, 62 Cal. App. 4th 94, 105 (1998).

For cases that are classified as complex, a discovery referee may beappointed even in the absence of discovery disputes. Such a referee can help inthe planning and scheduling of discovery in order to "suppress unnecessary andburdensome discovery procedures." n14

n14 Lu v. Superior Court, 55 Cal. App. 4th 1264, 1269-70 (1997); see CAL. R.OF CT. 1800-1830 and app., div. 1, Stds. of Jud. Admin., § 19(f).

Once it becomes clear that a discovery reference may be forthcoming,litigators must focus their attention on the selection and appointment of thediscovery referee as well as the establishment of the rules that will govern thereference. Without the right referee and an adequate reference order, it will bedifficult to achieve an effective result.

A discovery referee may be appointed on the court's own motion or on theapplication of a party. In either circumstance, lawyers should be prepared witha list of referee candidates rather than suddenly finding themselves in thecorridor of the courthouse trying to pick a name from a list provided by thecourt. n15

n15 The court is required to provide the parties with a "sufficient number ofnames" from which to select a referee. CAL. RULES OF CT. 244.2(b).

Consenting to a discovery referee may cause problems because a consensualreferee does not fit cleanly under either Section 638 or Section 639. Theparties' mutual consent therefore creates an opportunity for the trial court to


apply the law of Section 638 referees to a discovery [*19] dispute thatSection 639 should govern. Also, when a referee is selected by mutual consent,it is unclear whether the referee's fees will be recoverable as costs. The rightto court review, and the procedures for the review, will differ depending onwhether the reference is consensual (Section 638) or nonconsensual (Section638). n16 It may be difficult to show good cause to withdraw consent to aconsensual referee. n17

n16 CODE CIV. PROC. §§ 638, 639, 645.

n17 CAL. RULES OF CT. 244.1(e) provides that the referee's error of fact orlaw does not constitute good cause for withdrawing consent.

Ethical and conflicts issues are a preliminary concern in selecting areferee. Referees have at least two conflicting customers to consider in eachassignment, and thus referees have an incentive to try to leave each side happyto some degree. Some parties, such as insurance companies and large law firms,are more likely than others to have used a specific referee in the past and toprovide business for the referee in the future.

Against that backdrop, Rule 244.2(c) of the California Rules of Courtgenerally requires that referees disclose facts that might provide grounds fortheir disqualification. More specifically, "A referee who has been privatelycompensated in any other proceeding in the past 18 months, as a judge, referee,arbitrator, mediator, or settlement facilitator, by a party, attorney or lawfirm in the instant case shall disclose the number and nature of such otherproceedings, including the name of any party, attorney, and law firm thatappeared in the previous case and is appearing in the instant case." n18 The ADRReport recommends extending the reporting period to 24 months and including thereferee's service as an expert witness or attorney to the list of relationshipsthat must be disclosed. n19 If the referee does not present an adequateconflicts form to the parties, the parties can prepare and present a form to thereferee.

n18 CAL. RULES OF CT. 244.2(c).

n19 ADR REPORT, supra note 1, at 89.

Parties most commonly select a retired judge as a referee. Retired judges whoserve as discovery referees usually charge from $ 300 to more than $ 500 perhour. Retired judges may have strong credibility with sitting judges. Retired orsemiretired attorneys also may be chosen as referees--a situation thatparticularly occurs in smaller practice communities--and attorneys may work formore affordable rates than judges.

Some referees prefer formal proceedings and expect formal papers as well.Others take a more informal approach to the proceedings and the requireddocuments. Some referees are amenable to hearing motions on informal papers,such as letter briefs, rather than formal noticed motions with briefing on thestatutory schedule for motions. Less formal proceedings may be particularlyappropriate when the referee has demonstrated a firm grasp of the case or whenthe specific motion raises only a few issues. If cost is a primary factor inselecting a referee, the parties, either separately or jointly, may investigatewhether a prospective referee is amenable to a less structured proceeding.


A party can object to the appointment of a specific referee, but theprocedures for doing so are somewhat amorphous. Code of Civil Procedure Section641 provides for objections to the appointment of any person as a referee on avariety of grounds, including the referee's relationship to a party, interest inthe case, and bias (either toward an issue or a party). An objection to theappointment of a person as a referee must be made with "reasonable diligence" ina writing filed with the court and served on the referee, according to Rule244.2(c) of the California Rules of Court. Neither the statute nor the rule setsforth further detail on the format or timing of an objection. Absent furtherguidance in a statute, rule of court, or published appellate opinion, anyobjection should be asserted as promptly as possible and in a formal captioneddocument that provides the evidentiary support for the objection andjustification for its timing. The requirement of reasonable diligence suggeststhat counsel should exercise initiative in determining whether any grounds existfor objection to the appointment of the specific referee.

A referee also is subject to a peremptory challenge pursuant to Code of CivilProcedure Section 170.6. A close reading of Section 170.6 uncovers conflictingguidance on the timing of peremptory challenges to discovery and other referees.This issue has been addressed in two appellate opinions, Autoland, Inc. v.Superior Court, and Pedus Services, Inc. v. Superior Court. n20

n20 CODE CIV. PROC. § 170.6; Autoland, Inc. v. Superior Court, 205 Cal. App.3d 857 (1988); Pedus Servs., Inc. v. Superior Court, 72 Cal. App. 4th 140(1999).

The Autoland and Pedus courts disagree on the timing of a Section 170.6peremptory challenge to an appointed referee. The Autoland court held that "anobjection to the appointment of a discovery referee must be made immediatelyupon notice of the selection by the trial judge." n21 Noting that the Autolandholding rests upon an analogy of a discovery referee to an all-purpose judge,the Pedus court rejected the analogy n22 by relying on the California SupremeCourt's definition of all-purpose judge in People v. Superior Court (Lavi). n23

n21 Autoland, 205 Cal. App. 3d at 861.

n22 Pedus, 72 Cal. App. 4th at 144-46.

n23 People v. Superior Court (Lavi), 4 Cal. 4th 1164, 1179-80 (1993).

Pedus adopts the "10 day/5 day" rule of Section 170.6(2), which provides, inpertinent part, that "where the . . . referee assigned to or who is scheduled to. . . hear the matter is known at least 10 days before the date set for . . .hearing, the motion shall be made at least five days before that date." n24 Itis unclear from Pedus, however, whether the "hearing" referred to is a hearingbefore the referee or before the court on the referee's report. Thus aperemptory challenge should be asserted at the earliest possible time. n25Counsel should be mindful that the next appointee may be worse than the onebeing challenged, and there are limitations on the number of peremptorychallenges available to a party. n26

n24 Pedus, 72 Cal. App. 4th at 146.


n25 Shain v. Peterson, 99 Cal. 486, 487 (1893).

n26 CODE CIV. PROC. § 170.6(3).

The Reference Order

Once a referee has been appointed, the next step is assuring that the orderof reference establishes a sound foundation for the proceedings before thereferee. Rule 244.2(a) of the California Rules of Court requires a Section 639reference to be made by written order with specific provisions. The order is thecharter for the reference proceeding, determining its scope and procedures aswell as the referee's powers. The clearer the reference order, the better. Ifthe court appoints the referee in a minute order, and the minute order isimprecise, counsel should prepare and submit for the court's approval an orderthat better conforms to the requirements of the California Rules of Court.

Whether the reference is appointed as a result of a party's motion or uponthe court's own initiative, Rule 244.2(a) requires that the order specify thereasons for the reference, the scope of the reference, and any conditions on thereference, including any limitation on the referee's total fees or hourly fee aswell as the terms of the obligation of each party to pay the referee. n27 (TheADR Report recommends setting forth in the reference order a maximum hourly rateand a maximum number of hours for the reference. n28) The order also must namethe referee. n29 If the reference is upon motion of a party, the motion papersmust specify the scope of the reference. n30

n27 See also CAL. R. OF CT. 532.2(a).

n28 ADR REPORT, supra note 1, at 98, 99.

n29 CAL. R. OF CT. 244.2(b).

n30 CAL. R. OF CT. 244.2(a).

Rule 244.2(e) of the California Rules of Court mandates additionalprovisions:

An order of reference under Section 639(e) of the Code of CivilProcedure to assist in the resolution of a discovery dispute shall:(1) Grant the referee authority to set the date, time, and place forall hearings determined by the referee to be necessary, to direct theissuance of subpoenas, to preside over hearings, to take evidence, andto rule on objections, motions, and other requests made during thecourse of the hearing.(2) Require the referee to submit a written report to the parties andto the court within 20 days after the completion of the hearing, witha proposed order and any recommendation for the imposition ofsanctions.(3) Require that objections to the report shall be served and filednot later than 15 calendar days after the [*20] report is mailed tocounsel, that any party who objects to the report shall serve and filenotice of a request for a hearing, and that copies of the objectionsand any responses shall be served on the referee.(4) State that the court may seek the recommendation of the referee asto an allocation of referee's fees.(5) Address other matters as necessary. n31


n31 CAL. R. OF CT. 244.2(e) (emphasis added); see also CAL. R. OF CT.532.2(e).

Subdivision (e)(2) of Rule 244.2 regarding written referee's reportsparallels Section 643 of the Code of Civil Procedure. A written referee's reportshould be the rule, not the exception. A waiver is appropriate only if theparties reach an agreement and commit it to writing.

The order provisions of Rule 244.2(e) set the timetable for writtenexceptions, although they do not specify the form. They imply that a hearing onexceptions is required, although case authority exists to the contrary. n32 Onemight infer that a written report is mandatory, even though there arecircumstances in which it may not be needed. Subdivision (e)(5) of Rule 244.2 isa catch-all provision that allows a reference order to include languagepermitting a mutual waiver of a written report.

n32 Marathon Nat'l Bank v. Superior Court, 19 Cal. App. 4th 1256, 1259(1993).

The Reference Hearing

A thorough, well-organized, and thoughtful hearing before the referee willincrease the likelihood that the reference report will be clear and acceptable.Proceedings before referees are governed by the Evidence Code. n33 Sincereferences under Code of Civil Procedure Section 639 are quasi-judicialproceedings, "A referee cannot make decisions based on information or matterswhich would be inadmissible before court." n34

n33 EVID. CODE § 300; Syfirst Family Ltd. Partnership v. Cheung, 70 Cal. App.4th 1334, 1341 (1999).

n34 Rice v. Brown, 104 Cal. App. 2d 100, 104 (1951).

The court in In re Rose held that the findings of a referee must be supportedby evidence in the record. n35 Rose involved a referee's hearing on a habeascorpus petition that claimed ineffective assistance of counsel. The refereeimplicitly disbelieved the petitioner's attorney, who was the sole witness, andrecommended denial of the petition. The referee's report, however, contained nofinding that the attorney witness was not credible, Accordingly, the court heldthat the referee's findings were not supported by evidence on the record.

n35 In re Rose, 62 Cal. 2d 384, 388-89 (1965).

It is counsel's responsibility to ensure that the hearing is a success. n36In measuring the hearing's effectiveness, several objectives should be met:- The proper disposition of all evidentiary objections--a difficult goal toaccomplish in any hearing.- The orderly and specific handling of all discovery items, which will minimizethe potential for ambiguity in the referee's rulings. The presentation in themoving papers can advance this objective by, among other things, limiting thenumber of items addressed in the motion and grouping together items raisingcommon issues.- The avoidance of repetitious and irrelevant arguments by counsel, with the


referee stepping in as needed.- The timely filing of the referee's report, with a clear set of recommendationsthat are consistent with the rulings at the hearing and the grounds for thoserulings expressed on the record.- The proper custodial care of exhibits by the referee, pursuant to thereferee's obligation. n37

n36 A referee should have access to court facilities for hearings, andhearings held in private facilities must be open to the public on the request ofany person. CAL. R. OF CT. 244.2(d).

n37 CAL. R. OF CT. 243(e).

Parties should consider addressing the structure of the hearing at the outsetand seeking some agreement on the order in which issues will be considered andresolved. The referee might be asked to give a tentative ruling as a means ofsetting an agenda for the hearing. Counsel may find it difficult to persuade areferee to dispose of evidentiary objections. It is worth making a record of therequest to rule on evidentiary objections at the outset of the hearings in orderto provide some defense to the argument that evidentiary objections were waived.Parties should consider asking the referee to specify the order in which thedisputed discovery items will be addressed, and the time allocated to each, inorder to avoid the situation in which there is extensive argument on a few itemsand the rest receive cursory treatment due to everyone's exhaustion.

Communications with referees must be conducted with discretion and care.Referees are subject to penal statutes regarding corrupt influencing n38 andmisconduct. n39

n38 PENAJ. CODE § 95 (prohibiting threats, gifts, and ex partecommunications).

n39 PENAL CODE § 96 (prohibiting promises by referee to a party as well aswillfully and corruptly permitting prohibited communications).

Hearing transcripts are not required by statute or court rule. If the papersare lengthy and formal, or the amount at stake is large, it may be advisable tohave a court reporter record and transcribe the proceedings at the hearing. Ifthe proceedings are not reported, counsel can invite a paralegal to the hearingto take detailed notes.

The decision to prepare a transcript of the proceedings does not ensure thatan organized hearing with clear rulings will result. In fact, there are risksinvolved when a transcript is prepared. The referee may rely on the reporter'spresence to compensate for an undisciplined hearing. Opposing counsel may usethe transcript to second-guess the referee or distort the referee's rulings.Some lawyers will selectively extract from a transcript just those remarks thatplace the opposing party or counsel in the worst light, and a hearing transcriptthat is filled with extraneous arguments invites misuse by opposing counsel.Lawyers may try to use the referee's comments or the argument of their opponentsas a ruling. A court reviewing exceptions to a referee's report may bedistracted rather than enlightened by the kind of argument that occurs atreference hearings.


The Referee's Report

The law is not definitive regarding the required elements of a discoveryreferee's report. There is no express requirement for item-by-item rulings, forexample, or any particular level of supporting analysis. Nevertheless,item-by-item rulings are recommended, unless certain items can be clearlygrouped together and treated in common. The referee's written report should beaccompanied by a proposed order that allows the court to confirm the reportpromptly once the time for filing exceptions has expired. The more inadequatethe report, the more problems may arise in its review.

If the referee's rulings are clear, and counsel agree on the rulings, thereferee's report might be waived. However, a waiver may result in the loss ofthe rulings' precedential value. At the very least, rulings should be confirmedwith opposing counsel in countersigned correspondence or placed on the recordand transcribed. If opposing counsel cannot be counted upon to abide strictly byagreements confirmed in correspondence, then a formal report should not bewaived.

The referee's report is due no later than 20 days from the conclusion of thehearing. n40 With respect to the court's review of the referee's report--areview that can be disappointing to the party taking exception to thereport--the rules again offer little guidance. In fact, the general rule isconfusing: the court must give the referee's report an independent review, n41but the referee's findings of fact are entitled to great weight if supported bysubstantial evidence. n42 It follows from these rules that if the issues raisedin discovery disputes are not factual in nature, the court should be guided byan independent review standard rather than a deferential one.

n40 Mandamus is available to compel a report--but it would seem impolitic inmost circumstances. Apartment and Hotel Fin. Corp. v. Will, 69 Cal. App. 476,478-79 (1924).

n41 Rockwell Int'l Corp. v. Superior Court, 26 Cal. App. 4th 1255, 1269(1994); Marathon Nat'l Bank v. Superior Court, 19 Cal. App. 4th 1256, 1261(1993).

n42 In re Avena, 12 Cal. 4th 694, 710 (1996); Estate of Beard, 71 Cal. App.4th 753, 777 (1999).

A party that fails to object to a referee's report may waive its right toobject. n43 The objection to the referee's report should specify the evidenceoverlooked or rejected by the referee. n44 Code of Civil Procedure Section 645provides that a referee's report on facts has the effect of a special verdict.n45

n43 Martino v. Denevi, 182 Cal. App. 3d 553, 557 (1986).

n44 Id.

n45 A special verdict makes findings of fact, with the judgment reserved tothe court. CODE CIV. PROC. § 624. CODE CIV. PROC. § 645 provides that a decisionof a referee may be excepted to and reviewed "in like manner as if made by thecourt." On its face, this provision pertains to a CODE CIV. PROC. § 638


reference rather than to a CODE CIV. PROC. § 639(e) reference.

In Martino v. Denevi, the court indicated two methods of taking exception tothe report of a discovery referee: 1) filing written objections, and 2) filing amotion to set aside the report. n46 Both alternatives are supported by case lawgoing back as far as the 1850s. n47 The party taking exception to the report hasonly 15 calendar days after the referee mails the report to file objectionsand/or move to set aside or modify the report. n48 The objections [*22] ormotion must be set forth in formal papers. The objections may be based on thereferee's improper exclusion of evidence, the admission of improper evidence, orany other act materially affecting the rights of the objecting party. The papersmust specify what evidence, if any, the referee failed to notice or consider.n49 The objections must be sent to the referee so that the referee can correctany error that he or she acknowledges. n50

n46 Martino, 182 Cal. App. 3d 553.

n47 McHenry v. Moore, 5 Cal. 90, 92 (1855).

n48 CAL. R. OF CT. 244.2(e)(3).

n49 Martino, 182 Cal. App. 3d at 556.

n50 CAL. R. OF CT. 244.2(e)(3).

The statutes and rules do not establish any briefing schedule, nor do theyspecifically apply the normal briefing calendar and notice provisions formotions to the exception procedures. The absence of such provisions suggeststhat a hearing is not required, as the court in Marathon National Bank v.Superior Court expressly held. n51 This leaves the objecting party in a bit of aquandary, however. Rule 244.2(e)(3) requires that a party filing objections to areferee's report also "serve and file notice of a request for a hearing" n52that need not be held. The provision for a request for a hearing suggests thatthe trial court selects the hearing date, if any, which provides furtherconfusion to the briefing schedule. Parties should consider proposing a briefingschedule in the request for a hearing and including the schedule in a proposedorder granting the request.

n51 Marathon Nat'l Bank v. Superior Court, 19 Cal. App. 4th 1256, 1259(1993).

n52 CAL. R. OF CT. 244.2(e)(3).

Since the court need not set a hearing, what must it do? The Marathon courtheld that the trial court "may consider the matter as the circumstancesdictate." n53 More specifically, the trial court's orders need only "demonstratea considered and careful review" of the referee's report and recommendations aswell as the written and oral proceedings underlying that report so that thecourt of appeal can "say with confidence that the trial court did not abdicateits judicial responsibilities." n54 This appears to be a standard readilysatisfied by any experienced judge--or easily found satisfied by any appellatecourt desirous of finding it satisfied.


n53 Marathon, 19 Cal. App. 4th at 1261.

n54 Id.

What if no exception is taken to the referee's report? Because the refereelacks the power to issue an order, the court's order of reference cannotrelegate a party dissatisfied with a referee's recommendations to the party'sappellate remedies. n55 It would appear, then, that a referee's report, on itsown, has no legal force, even if there are no exceptions to it. Some action ofthe court is required to give effect to the referee's recommendations.

n55 Doyle v. Superior Court, 50 Cal. App. 3d 1878, 1884 n.1 (1996).

Neither the statutes nor the California Rules of Court provide a procedurefor confirming a referee's report. n56 In order to give effect to a referee'srecommendation, a motion for confirmation should be filed promptly after the15-day period has expired for exceptions to the report. Once the time forexception has expired, the motion can arguably be made by an ex parteapplication. The application should include a copy of the referee's report and aproposed order.

n56 CODE CIV. PROC. §§ 639 et seq.; CAL. R. OF CT. 244.2, 532.2.

Even in the absence of judicial confirmation of the referee's recommendation,as a practical matter it would seem that the courts might enforce therecommendations of a discovery referee to which no exception has been taken.There is some authority that a motion to confirm may be granted at some removefrom the submission of the referee's report. n57

n57 Martino v. Denevi, 182 Cal. App. 3d 553, 557 (1986).

Fees and Costs

The fees subject to dispute in the discovery reference process include thefees that are billed to the parties by the discovery referee, the fees that anadverse party may seek to recover, and the fees that a party may seek to shiftto an adverse party. Referee's fees may be recoverable as costs. n58

n58 CODE CIV. PROC. § 1023; DeBlase v. Superior Court, 41 Cal. App. 4th 1279,1285 (1996); Winston Square Homeowners Ass'n v. Centex West, Inc., 213 Cal. App.3d 282, 293 (1989); Most Worshipful Sons of Light Grand Lodge v. Sons of LightLodge No. 9, 140 Cal. App. 2d 833, 835 (1956).

The referee's fees are fixed by the court and are supposed to be reasonable.They should be determined based on the time devoted to the reference. n59 Inspite of these principles, a number of uncertainties about fees arise and needconsideration. For example, [*55] the referee's billable time may includetravel time. In choosing between two equally acceptable referees, the refereewith a nearby office may be preferable.

n59 CODE CIV. PROC. § 1023.


Referee's fees usually are divided equally between the plaintiffs' side andthe defendants' side or equally among all parties. The parties can stipulate inwriting to a different fee arrangement. Code of Civil Procedure Section 1023implies that the referee's fees must be a "rate," which, as a practical matter,means an hourly rate.

The court may allocate the referee's fees among the parties in any fair andreasonable manner. n60 The court may decide to make one party pay all the feessubject to a later reallocation. A party might seek a reallocation of thereferee's fees by way of a cost bill, even if the party is on the losing side.Courts routinely state that the referee's fees are subject to reallocation, butsubsequent reallocation is not common.

n60 CODE CIV. PROC. § 645.1.

The cost of a referee can be a significant burden on an indigent party or onewith comparatively limited resources. The appellate courts encourage the trialcourts to handle discovery disputes themselves when a party claims indigence oruse cost-free alternatives to expensive discovery referees. They prohibit acourt from imposing the full cost of the referee on a party with extensiveresources or on the referee. n61 On the other hand, in complex, multipartylitigation, if a party makes a showing of "significant hardship," the courtcannot force that party to contribute to the cost of the referee. n62

n61 DeBlase, 41 Cal. App. 4th 1279, 1282-86; Taggeres v. Superior Court, 62Cal. App. 4th 94 (1998).

n62 Lu v. Superior Court, 55 Cal. App. 4th 1264, 1270 (1997).

The California Rules of Court also recognize the economic burden of referees.Rule 244.2(a) requires that the trial court consider the economic impact of areference on the parties in deciding whether to make a reference on the motionof a party. Additionally, the rule provides that the court may determine thefair and reasonable division of the reference costs if a party raises aneconomic hardship argument prior to the time the referee has commenced providingservices. This order can be modified at a later time, and the court is permittedto consider the referee's recommendation regarding the division of fees. n63

n63 CAL. R. OF CT. 244.2(a).

Actual payment of the fees by a responsible party can be an issue. In arecent case, the court held that, under the proper circumstances, a refereecould secure a lien on a party's settlement proceeds, but the trial court cannotorder the party's counsel to pay the referee's fees. n64 A party's failure topay the court-ordered fees of a discovery referee could subject the party todiscovery sanctions as [*56] well as other types of sanctions. n65

n64 MacMillan v. Superior Court, 50 Cal. App. 4th 246, 255 (1998).

n65 CODE CIV. PROC. § 2023 (discovery sanctions), § 128(a) (generalsanctions).

The Judicial Council and the legislature should address the gaps that remain


in the law governing discovery referees, the proceedings before them, and thedisposition of referee recommendations. The use of discovery referees hasdisturbed courts and commentators. There are biases inherent in the use ofdiscovery referees, and the system appears vulnerable to abuse by under fundedcourts or courts lacking the appropriate degree of diligence. The discoveryreference process requires counsel to plan carefully and make tradeoffs betweencost and risk. With even the best-laid plans, however, the law remainsunresolved on a number of important aspects of discovery references. Thus thepotential for disappointment remains available to one and all, but mostespecially to the inattentive litigator.

Legal Topics:

For related research and practice materials, see the following legal topics:Civil ProcedureJudicial OfficersRefereesAppointmentsCivil ProcedureJudicialOfficersReferencesGovernmentsCourtsCourt Personnel


FOCUS - 7 of 10 DOCUMENTS

Copyright (c) 2001 Los Angeles County Bar AssociationLos Angeles Lawyer

June, 2002

25 Los Angeles Lawyer 22

LENGTH: 2604 words

FEATURE: RECENT LEGISLATION MAKES THE USE OF COURT-APPOINTED DISCOVERY REFEREESMORE USER FRIENDLY: DISCOVERY CHANNEL

By Christine Byrd

Christine Byrd is a litigation partner at Irell & Manella LLP with over 25 yearsof experience in litigation and discovery matters. She is also an arbitratorwith the American Arbitration Association.

TEXT:

[*22] Until recently, California courts had the authority under Code ofCivil Procedure Section 639 to require parties to use discovery refereeswhenever "necessary." The decision as to when a discovery referee was necessarywas left to the discretion of the trial court. However, critics charged thatdiscovery referees were often unnecessary and imposed undue financial burdens onthe parties.

Responding to such criticisms, two years ago the California Legislatureenacted a new law, AB 2912, n1 that, beginning in 2001, eliminated the trialcourt's discretion under Section 639 and imposed specific conditions on theappointment of discovery referees in order to protect parties againstunnecessary or inappropriate appointments. n2 The legislation dramaticallyamended Section 639 and other provisions applicable to discovery referees. Thelegislature also directed the Judicial Council to collect and report informationregarding the use of discovery referees under Section 639. The next year, thelegislature extended the reporting deadline but underscored its mandate: "It isthe intent of the Legislature that the practice and cost of referring discoverydisputes to outside referees be thoroughly reviewed." n3

n1 2000 Cal. Stat. ch. 644, § 2.

n2 When all parties consent to the appointment of a discovery referee, Codeof Civil Procedure § 638 applies, not § 639. When the parties do not consent, §639 is applicable. The focus of this article is on § 639.

n3 CODE CIV. PROC. § 640.5. The legislature also expanded its mandate by

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requiring the Judicial Council to report on the use of referees in discoverymatters pursuant to either Code of Civil Procedure § 638 or § 639.

The new requirements for the appointment of a discovery referee without theconsent of all parties are clear regarding what a court cannot do and what anappointment order must contain:- The court cannot appoint a discovery referee absent "exceptionalcircumstances."- The court cannot appoint a discovery referee without express findingsregarding the ability of the parties to pay for the referee's fees.- The court order appointing a discovery referee must be in writing.- The court must specify in the order the scope of the reference.- The court order must include the name, business address, and telephone numberof the referee.- The court order must specify the maximum hourly rate the referee may chargeand, if a party requests, the maximum number of [*24] hours that the refereemay charge.

One of the most significant requirements is the change in the standard underwhich a discovery referee can be appointed absent the consent of the parties.Under the new law, a discovery referee can be appointed only under "exceptionalcircumstances..., which must be specific to the circumstances of the particularcase." n4 This amendment should go far in preventing any unnecessaryappointments, although what constitutes "exceptional circumstances" justifying acourt's decision to appoint a discovery referee remains to be seen. It is worthnoting that the language is substantially similar to the language in Rule 53 ofthe Federal Rules of Civil Procedure, governing the appointment of specialmasters, which provides that a reference to a master "shall be the exception andnot the rule." n5

n4 CODE CIV. PROC. § 639(d)(2).

n5 FED. R. CIV. P. 53(b).

Ability to Pay

A requirement in the new law that is as important as the changed standard forappointment of a referee involves the referee's fees. Even if exceptionalcircumstances warrant the appointment of a discovery referee, the court cannotappoint one without first determining whether the parties have the ability topay the referee's fees. n6 In fact, the bulk of the amendments enacted in 2000address this issue. To appoint a discovery referee, the court must find that "noparty has established an economic inability to pay a pro rata share of thereferee's fees." n7 As for the obvious question of whether a lawyer's ability topay may be considered, the answer is no. The court is allowed to consider "onlythe ability of the party, not the party's counsel, to pay these fees." n8

n6 CODE CIV. PROC. § 639(d)(6). No such finding is required if the referee isserving gratis. The requirement of findings regarding the parties' ability topay for the referee applies only when the referee is being appointed "at a costto the parties." CODE CIV. PROC. § 639(d)(6)(A).

n7 CODE CIV. PROC. § 639(d)(6)(A).


n8 CODE CIV. PROC. § 639(d)(6)(B) (emphasis added).

The economic analysis of a party's ability or inability to pay for adiscovery referee must not take place in a vacuum. The court is expresslydirected to consider "the estimated cost of the referral and the impact of theproposed fees on the party's ability to proceed with the litigation." n9 Thepurpose of this amendment is to ensure that no party is forced to sacrificenecessary case preparation in order to pay the costs of a discovery referee.Indeed, at the request of a party, the order for the appointment of a discoveryreferee must set forth clearly the maximum number of hours for which the refereemay charge. n10 The maximum may be modified but only upon written application(by a party or by the referee) and only for good cause.

n9 Id.


The provision for a cap on a discovery referee's fees is an obvious responseto past criticisms, and its benefit to the parties is clear. It may also helpthe court by making it easier to assess the economic impact of an appointment,particularly on parties with limited financial resources who might benefit fromthe appointment of a discovery referee.

If one party is unable to pay, then a discovery referee cannot be appointedunless any other party, even an opposing party, "has agreed voluntarily to paythat additional share of the referee's fee." n11 In this circumstance, the courtmay proceed to appoint the discovery referee. While such cases may not becommon, this provision will be a benefit in large multiparty cases in which thelarger parties are willing and able to pay a referee's fees and the smallerparties are unable to do so. The legislature did not address the implications ofhaving a discovery referee paid by only one side in a lawsuit. In thatsituation, to avoid an appearance of bias, the court may wish to withhold fromthe discovery referee the identity of the party or parties paying the referee'sfees.

n11 CODE CIV. PROC. § 639(d)(6)(A).

The new law also requires that the court specify the scope of the referenceat the time the discovery referee is appointed. This requirement appears twicein the amendments. First, Section 639(c) requires that the order "indicatewhether the referee is being appointed for all discovery purposes in theaction." n12 Second, Section 639(d)(3) requires that the order specify "thesubject matter or matters included in the reference." n13 These changes are asignificant improvement, because the written order will give clear direction tothe referee and to the parties as to the scope of the appointment. However, theuse of different language in subsections (c) and (d) is puzzling.

n12 CODE CIV. PROC. § 639(c).


The remaining requirements are informational in nature. The court order nowmust be in writing, and it must include the name, business address, telephone


number, and maximum hourly rate of the referee. n14 Also, a copy of the ordermust be forwarded to the presiding judge of the court. n15

n14 CODE CIV. PROC. § 639(d)(4) and (5).

n15 CODE CIV. PROC. § 639(e).

In the event that a party disagrees with a discovery referee's report, a fullreview by the court is available: "The decision of the referee...is onlyadvisory." n16 The court may adopt the referee's decision in whole or in part,change the decision, or disregard it entirely, but only "after independentlyconsidering the referee's findings and any objections and responses theretofiled with the court." n17 It should be noted that, regarding the review, thestatute does not provide the parties with any right to a hearing.

n16 CODE CIV. PROC. § 644(b). No such review is available for a consensualgeneral reference pursuant to § 638. CODE CIV. PROC. § 644(a).

n17 CODE CIV. PROC. § 644(b); CODE CIV. PROC. § 643.

Benefits of Using a Referee

These new requirements should eliminate unnecessary appointments, but discoveryreferees should continue to be appointed in appropriate cases. The types ofcases in which discovery referees have traditionally been appointed are thoserequiring the full-time [*25] attention of a judge, those requiring technicalexpertise, or both.

For example, environmental cleanup cases can easily involve dozens of partiesif all current and prior landowners are named in an action or in thecross-actions. They can also include technical issues. Likewise, constructiondefect cases, in which numerous contractors and subcontractors are sued, canalso contain multiple parties and technical issues.

A discovery referee who understands the technical problems in a multipartycase can handle discovery matters quickly and efficiently. Such a referee can bea tremendous benefit to the parties. However, for parties who are individualswithout insurance coverage, the cost of a discovery referee can be burdensome.The changes to Section 639 allow the courts to continue to appoint discoveryreferees in those cases in which they will be a benefit to the parties, but thechanges protect small parties against prohibitive fees.

Of course the appointment of a discovery referee does not guarantee thatdiscovery will proceed more efficiently than it would before a judge. Somejudges are excellent at actively supervising discovery matters and rarelyappoint discovery referees. For example, Judge J. Stephen Czuleger is reluctantto appoint referees even when lawyers request one. "It is not enough for lawyersto tell me there is a need for a referee in their case," Judge Czuleger said."They need to tell me specifically what they want the referee to do, rather thanleaving it open-ended." n18

n18 Telephone interview with author. Mar. 13, 2002.


Lawyers frequently see the appointment of a referee as leading to a delay ofthe trial. However, the appointment of a discovery referee should not prolongthe resolution of a case. Indeed, one of the benefits of having a discoveryreferee should be the faster handling of discovery matters. A good discoveryreferee can allow the parties to obtain legitimate discovery and enforcelegitimate objections while minimizing the time and expense normally associatedwith discovery disputes.

For example, a discovery referee can 1) require that disputes be raisedimmediately, 2) eliminate "meet and confer" sessions, and 3) streamline thedocumentation that must accompany a motion to compel. With a discovery referee,counsel can sit down and discuss precisely what information is being sought;what information is relevant; what persons or locations are likely to have thatinformation; what logistics, software requirements, or organizational issues areinvolved; and what type of search is likely to result in useful information. Adiscovery referee also can work with counsel to develop a discovery program thatserves the interests of all parties. [*26] The appointment of a discoveryreferee should shorten, rather than lengthen, the life of a case.

The Delay Issue

Although the amendments to Section 639 are a definite improvement, they do notaddress the critical issue of delay. Not one of the changes to Section 639requires that a referee hear discovery matters promptly. Code of Civil ProcedureSection 643 does provide that the referee must report to the court "within 20days after the hearing, if any, has been concluded and the matter has beensubmitted." n19 However, before Section 643 applies, the referee continues tohave discretion and control over the speed with which a matter is heard andsubmitted.

n19 CODE CIV. PROC. § 643(a).

Although legislative changes to address the issue of delay will no doubt besuggested in years to come, the courts can also address this problem in themeantime. One simple way to eliminate delay is for the court to ensure that thediscovery referee is both active and knowledgeable. Another way is by includinga sunset provision in the appointment order, so that the appointmentautomatically concludes at a certain date with the issuance of a final report.Judge Czuleger has also developed a simple way to eliminate delay. His policy isto maintain the original trial date, regardless of the appointment of a referee.He believes that this policy is effective in encouraging efficiency in thediscovery process.

The changes to Section 639 do not apply to the appointment of discoveryreferees with the consent of all parties, which is addressed by Section 638.Even so, parties should contemplate using the new amendments as guidelines whenconsenting to Section 638 appointments. The new Section 639 requirements arethoughtful and worthwhile. Parties also should consider requesting a sunsetprovision in any appointment of a discovery referee, whether under Section 638or 639.

The overall impact of the new changes governing the appointment of discoveryreferees under Section 639 remains open to debate, but data on theimplementation of the new amendments will be available soon. The Judicial


Council is required to collect all orders appointing discovery referees, bothunder Section 638 and Section 639. The Judicial Council is then required toreport to the legislature on the number of appointments, the cost to theparties, and the time spent by the discovery referees. n20 The deadline for thatreport is July 1, 2003. n21

n20 CODE CIV. PROC. §§ 638(c), 639(e), 640.5.

n21 Id.

It will be interesting to review the information collected by the JudicialCouncil and to see what effect, if any, the legislative changes have had ondiscovery referee appointments.

Legal Topics:

For related research and practice materials, see the following legal topics:Civil ProcedureJudicial OfficersJudgesGeneral OverviewCivil ProcedureJudicialOfficersRefereesAppointmentsCivil ProcedureJudicial OfficersReferences

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